Treasury Laws Amendment (Tax Integrity and Other Measures) Act 2018 (124 of 2018)

Schedule 1   Multinational anti-avoidance law

Income Tax Assessment Act 1936

2   At the end of section 177DA

Add:

Income from supply by trust estate or partnership

(7) Subsection (8) applies if:

(a) both of the following conditions are satisfied:

(i) a trust estate or partnership makes a supply to an entity;

(ii) that entity would be an Australian customer of the trust estate or partnership if the trust estate or partnership were a foreign entity; and

(b) because of the supply, an amount of ordinary income, or statutory income, is included in the assessable income of the trust estate or partnership (as worked out for the purposes of working out its net income for a year of income); and

(c) the trust estate or partnership has a foreign entity participant at any time in that year of income; and

(d) any of the following conditions are satisfied at the time the supply is made:

(i) the trust estate or partnership is connected with (within the meaning of the Income Tax Assessment Act 1997) a foreign entity;

(ii) the trust estate or partnership would be an affiliate (within the meaning of that Act) of a foreign entity if the trust estate or partnership were an individual or a company;

(iii) the trust estate or partnership and a foreign entity are members of the same global group.

(8) For the purposes of this section:

(a) treat the foreign entity mentioned in paragraph (7)(d) as having made the supply; and

(b) treat the entity mentioned in subparagraph (7)(a)(ii) as being an Australian customer of the foreign entity; and

(c) treat the foreign entity as having derived the ordinary income, or statutory income, from the supply.