INCOME TAX RATES ACT 1986

Schedules

SCHEDULE 7 - GENERAL RATES OF TAX  

Subsection 12(1)


PART I - RESIDENT TAXPAYERS  

SECTION 2.   2.  
Where -


(a) the taxable income of a resident taxpayer consists of or includes a special income component; and


(b) Division 16 of Part III of the Assessment Act does not apply to the income of the taxpayer; and


(c) Division 392 (Long-term averaging of primary producers ' tax liability) of the Income Tax Assessment Act 1997 does not apply to the taxpayer ' s assessment;

the rate of tax for every $1 of the taxable income is the amount ascertained in accordance with the formula


A+B ,
C

where -

A is the amount of tax that would be payable by the taxpayer under clause 1 on a taxable income equal to the reduced taxable income;

B is 5 times the difference between -

  • (c) the amount of tax that would be payable by the taxpayer under clause 1 on a taxable income equal to the sum of -
  •   (i) the reduced taxable income; and
  •   (ii) 20% of the special income component of the taxable income; and
  • (d) the amount of tax that would be payable by the taxpayer under clause 1 on a taxable income equal to the reduced taxable income; and
  • C is the number of whole dollars in the taxable income.

    In applying the formula, component B is to be worked out on the assumption that the whole of the taxable income is ordinary taxable income.




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