TAXATION ADMINISTRATION ACT 1953

SCHEDULE 1 - COLLECTION AND RECOVERY OF INCOME TAX AND OTHER LIABILITIES  

Note: See section 3AA .

Chapter 2 - Collection, recovery and administration of income tax  

PART 2-10 - PAY AS YOU GO (PAYG) INSTALMENTS  

Division 45 - Instalment payments  

Subdivision 45-C - Working out instalment amounts  

SECTION 45-120   MEANING OF INSTALMENT INCOME  

General rule

45-120(1)  
Your instalment income for a period includes your *ordinary income *derived during that period, but only to the extent that it is assessable income of the income year that is or includes that period.

Note 1:

No other amount is instalment income unless it is covered by another provision of this section or by Subdivision 45-H or 45-I .

Note 1A:

The operation of this section and other provisions relating to instalment income is affected by sections 45-855 and 45-860 (about a member of a consolidated group during a period before the members of the group are treated as a single entity for the purposes of this Part.)

Note 2:

If during that period you are a partner in a partnership, or a beneficiary of a trust, your instalment income also includes some of the partnership ' s or trust ' s instalment income for the period (except in some cases). See Subdivision 45-H or 45-I .

Statutory income included for some entities

45-120(2)  
The instalment income of:


(a) a *complying approved deposit fund or a *non-complying approved deposit fund; or


(b) a *complying superannuation fund or a *non-complying superannuation fund; or


(c) a *pooled superannuation trust;


(ca) (Repealed by No 70 of 2015)

for a period also includes the entity ' s *statutory income, to the extent that:


(d) it is reasonably attributable to that period; and


(e) it is assessable income of the income year that is or includes that period.

45-120(2A)  


The instalment income of a *life insurance company for a period also includes any part of its *statutory income that:


(a) is reasonably attributable to that period; and


(b) is included in the *complying superannuation class of its taxable income for the income year that is or includes that period.

Net gains under Subdivision 250-E of the Income Tax Assessment Act 1997 included in instalment income

45-120(2B)  


Your instalment income for a period also includes the difference between:


(a) a gain (or gains) you make from a *financial arrangement to the extent to which it is (or they are):


(i) assessable under Subdivision 250-E of the Income Tax Assessment Act 1997 ; and

(ii) reasonably attributable to that period; and


(b) a loss (or losses) you make from a financial arrangement to the extent to which it is (or they are):


(i) allowable to you as a deduction under Subdivision 250-E of the Income Tax Assessment Act 1997 ; and

(ii) reasonably attributable to that period.

This is so only if the gain (or gains) referred to in paragraph (a) exceeds the loss (or losses) referred to in paragraph (b).

Effect of Division 230 of the Income Tax Assessment Act 1997 on instalment income

45-120(2C)  
Your instalment income for a period also includes the difference between:


(a) a gain (or gains) you make from a *financial arrangement to the extent to which it is (or they are):


(i) assessable under Division 230 of the Income Tax Assessment Act 1997 ; and

(ii) reasonably attributable to that period; and


(b) a loss (or losses) you make from a financial arrangement to the extent to which it is (or they are):


(i) allowable to you as a deduction under Division 230 of the Income Tax Assessment Act 1997 ; and

(ii) reasonably attributable to that period.

This is so only if the gain (or gains) referred to in paragraph (a) equals or exceeds the loss (or losses) referred to in paragraph (b).

45-120(2D)  


However, your instalment income for a period is worked out disregarding subsection (2C) if any of the following apply:


(a) you are an individual;


(b) the only gains and losses that would be taken into account under subsection (2C) for the period are from *financial arrangements that are *qualifying securities.

45-120(2E)  


A gain or loss that is taken into account under subsection (2C) in working out an amount (including a nil amount) to be included in your instalment income for a period is not to be, to any extent, taken into account again under another provision of this section in calculating your instalment income for the same or any other period. Exclusion: amounts in respect of withholding payments

45-120(3)  


Your instalment income for a period does not include amounts in respect of:


(a) *withholding payments (except *non-quotation withholding payments) made to you during that period; and


(b) amounts included in your assessable income under section 86-15 of the Income Tax Assessment Act 1997 for which there are amounts required to be paid under Division 13 ; and


(c) which a penalty is applicable under section 12-415 .

Farm management deposits: effect of making and repayment

45-120(4)  


Your instalment income for a period is reduced (but not below nil) by a *farm management deposit made during that period, but only to the extent that, at the end of that period, you can reasonably expect to be able to deduct the deposit under section 393-5 of the Income Tax Assessment Act 1997 for the income year that is or includes that period.

45-120(5)  


Your instalment income for a period also includes an amount that section 393-10 of the Income Tax Assessment Act 1997 includes in your assessable income, for the income year that is or includes that period, because of a repayment during that period of all or some of a *farm management deposit. Gross proceeds on disposal of registered emissions units included in instalment income

45-120(5A)  


Your instalment income for a period also includes an amount that section 420-25 of the Income Tax Assessment Act 1997 includes in your assessable income, for the income year that is or includes that period, because you cease to *hold a *registered emissions unit during that period. Instalment income of entity that is not liable for instalments

45-120(6)  
An entity can have *instalment income for a period even if the entity is not liable to pay an instalment for that period.

Note:

For example, although a partnership does not pay instalments, it is necessary to work out the partnership ' s instalment income in order to work out instalments payable by the partners. See Subdivision 45-H .




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