Product Ruling
PR 2005/42A - Addendum
Income tax: Queensland Paulownia Forests Project No. 8 - Income Forestry Bonds
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FOI status:
may be releasedAddendum
This Addendum amends Product Ruling PR 2005/42 to reflect changes to the simplified tax system legislation from 1 July 2005.
PR 2005/42 is amended as follows:
Omit the paragraph and substitute:
- 51. To be an 'STS taxpayer' a CFU Holder must be eligible to be an 'STS taxpayer' and must have elected to be an 'STS taxpayer'. Changes to the STS rules apply from 1 July 2005. From that date, STS taxpayers may use the accruals accounting method. For a CFU Holder participating in the Project, the recognition of income and the timing of tax deductions is different under the STS where the CFU Holder uses the cash accounting method.
Omit the paragraph and substitute:
- 54. A CFU Holder will recognise ordinary income from carrying on the business of afforestation at the time that income is derived when they are:
- •
- not an 'STS taxpayer'; or
- •
- an 'STS taxpayer' using the accruals accounting method for the 2005-06 and later income years.
Omit the paragraph and substitute:
- 55. A CFU Holder who is an 'STS taxpayer' using the cash accounting method will be assessable on ordinary income from carrying on their business of afforestation in the income year in which that income is received.
(a) Omit the paragraph and substitute:
- 60. However, if for any reason, an amount shown or referred to in the Table below is not fully paid in the year in which it is incurred by a CFU Holder who is an 'STS taxpayer' using the cash accounting method then the amount is only deductible to the extent to which it has been paid, or has been paid for the CFU Holder. Any amount or part of an amount shown in the Table below which is not paid by the CFU Holder who is an 'STS taxpayer' using the accruals accounting method in the year in which it is incurred will be deductible in the year in which it is actually paid. The years shown in the Table below relate to a CFU Holder who is accepted into the Project on or before 30 June 2005.
(b) Omit the table and substitute:
| Fee Type | Year ended 30 June 2005 | Year ended 30 June 2006 | Year ended 30 June 2007 |
|---|---|---|---|
| Establishment services fee for Seasonally Dependent Agronomic Activities | $914 See Notes (i) & (ii) |
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| Establishment services fee for non-Seasonally Dependent Agronomic Activities | $164 See Notes (i) & (ii) |
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| Licence fees | See Notes (i) & (iii) | ||
| Interest incurred or paid to QPFL Finance Pty Ltd | As incurred (Non-STS taxpayers) or as paid (STS taxpayers) See Note (iv) |
As incurred (Non-STS taxpayers and STS taxpayers using accruals accounting) or as paid (STS taxpayers) See Note (iv) |
As incurred (Non-STS taxpayers and STS taxpayers using accruals accounting) or as paid (STS taxpayers) See Note (iv) |
(c) Omit the third sentence in Note (ii) and substitute:
- The establishment services fee is deductible in the income year in which it is incurred (where the CFU Holder is not an 'STS taxpayer' or is not an 'STS taxpayer' using the cash accounting method) or in the year in which it is paid (where the CFU Holder is an 'STS taxpayer' using the cash accounting method).
(d) Omit the third sentence in Note (iii) and substitute:
- 'Excluded expenditure' is an 'exception' to the prepayment rules and is deductible in full in the year in which it is incurred (where the CFU Holder is not an 'STS taxpayer' or is not an 'STS taxpayer' using the cash accounting method) or in the year in which it is paid (where the CFU Holder is an 'STS taxpayer' using the cash accounting method).
This Addendum applies on and from 1 July 2005.
Commissioner of Taxation
25 January 2006
References
ATO references:
NO 2005/18404