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 2-5 - PAY AS YOU GO (PAYG) WITHHOLDING  

Division 12A - Distributions by AMITs (including deemed payments)  

Subdivision 12A-B - Distributions by AMITs relating to Subdivision 12-H fund payments  

Operative provisions

SECTION 12A-110   MEANING OF FUND PAYMENT - AMITs  

12A-110(1)  
This section applies to a trust that is an *AMIT for an income year.

12A-110(2)  
The object of this section is to ensure that the total of the *fund payments that the trustee of the *AMIT makes in relation to the income year equals, as nearly as practicable, the amount mentioned in subsection (3).

12A-110(3)  
The amount is the sum of the following amounts:


(a) total of the *determined member components for the *AMIT for the income year of a character relating to assessable income, disregarding determined member components (the excluded components ) of any of the following characters:


(i) the character of a *discount capital gain from a *CGT asset that is not *taxable Australian property;

(ii) the character of a *capital gain (other than a discount capital gain) from a CGT asset that is not taxable Australian property;

(iii) the character of a dividend (as defined in Division 11A of Part III of the Income Tax Assessment Act 1936 ) that is subject to, or exempted from, a requirement to withhold under Subdivision 12-F ;

(iv) the character of interest (as defined in Division 11A of Part III of the Income Tax Assessment Act 1936 ) that is subject to, or exempted from, a requirement to withhold under Subdivision 12-F ;

(v) the character of a *royalty that is subject to, or exempted from, a requirement to withhold under Subdivision 12-F ;

(vi) the character of *ordinary income, or *statutory income, from a source other than an *Australian source;

(vii) if a legislative instrument under subsection (4) specifies a character - that character;


(b) the total of each *capital loss of the AMIT from a *CGT event that:


(i) happened in the income year to a CGT asset that is not taxable Australian property; and

(ii) has been applied against a capital gain from a CGT event that happened in relation to a CGT asset that is taxable Australian property;
but only to the extent that each such capital loss has been so applied in the income year;


(c) the total of each amount to which subsection (3A) applies in relation to the income year.

12A-110(3A)  
If:


(a) the AMIT has a *net capital loss for an earlier income year; and


(b) one or more of the *capital losses the trust made during that earlier income year were from *CGT events that happened in relation to *CGT assets that were not *taxable Australian property; and


(c) in relation to the income year mentioned in paragraph (3)(c), some or all of the net capital loss is applied against a *capital gain from a CGT event that happens in relation to a CGT asset that is taxable Australian property; this subsection applies, for the income year mentioned in paragraph (3)(c), to an amount equal to so much of the net capital loss that is so applied as related to capital losses mentioned in paragraph (b) of this subsection.

12A-110(4)  
The Commissioner may, by legislative instrument, specify one or more characters for the purposes of subparagraph (3)(a)(vii).

12A-110(5)  
A payment (the actual or deemed payment ) that the trustee of a trust makes in relation to an income year is a fund payment in relation to that year. However, the amount of the fund payment is worked out under the following method statement, and may be:


(a) the amount of the actual or deemed payment; or


(b) the amount of the actual or deemed payment, increased or reduced as a result of the method statement.

Note:

The payment by the trustee may be an actual payment, or a deemed payment under section 12A-205 .

Method statement

Step 1.

Reduce the actual or deemed payment by so much of it that is attributable to the excluded components.


Step 2.

Work out what it is reasonable to expect will be the amount mentioned in subsection (3).

Do so on the basis that a *capital gain from *taxable Australian property of the trust that was or would be reduced under step 3 of the method statement in subsection 102-5(1) of the Income Tax Assessment Act 1997 were double the amount it actually is.


Step 3.

The fund payment is so much of the step 2 amount as is reasonable having regard to:

  • (a) the object of this section; and
  • (b) the step 1 amount; and
  • (c) the amounts of any earlier fund payments made by the trustee in relation to the income year; and
  • (d) the expected amounts of any later fund payments the trustee expects to make in relation to the income year.
  • 12A-110(6)  
    The amount mentioned in subsection (3) and the expected amounts of any later *fund payments are to be worked out on the basis of the trustee ' s knowledge when the payment is made.

    12A-110(7)  
    Subsection (6) does not apply if the payment is a payment arising because of the operation of section 12A-205 (deemed payments).

    12A-110(8)  
    However, the payment is not a fund payment in relation to the income year if:


    (a) the payment (the actual payment ) is a *post-AMMA actual payment in respect of another payment; and


    (b) the other payment arises because of the operation of section 12A-205 ; and


    (c) the other payment is a fund payment.

    12A-110(9)  
    An amount is also not a fund payment in relation to the income year unless it is paid:


    (a) during the income year; or


    (b) within 3 months after the end of the income year; or


    (c) within a longer period (starting at the end of the period referred to in paragraph (b) and not exceeding 3 years) allowed by the Commissioner.

    12A-110(10)  
    The Commissioner may allow a longer period as mentioned in paragraph (9)(c) only if the Commissioner is of the opinion that:


    (a) if the other payment arises at a time because of the operation of section 12A-205 (deemed payments) - the *AMIT complied with subsection 276-455(1) of the Income Tax Assessment Act 1997 in respect of the income year (requirement to give AMMA statements within 3 months); or


    (b) otherwise - the trustee was unable to make the payment during the income year, or within 3 months after the end of the income year, because of circumstances beyond the influence or control of the trustee.




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