Income Tax Assessment Act 1936
View history note
Hide history notePart XI repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. No 114 of 2010, Sch 1 item 95 contains the following saving provisions:
95 Saving of regulations relating to stock exchanges
95
Despite the repeal of the definition of
approved stock exchange
in section 470 of the
Income Tax Assessment Act 1936
by item 37 of this Schedule, regulations made for the purposes of that definition that were in force immediately before this item commences continue in force on and after that commencement as if those regulations had been made for the purposes of the definition of
approved stock exchange
in the
Income Tax Assessment Act 1997
as inserted by item 81 of this Schedule.
96 Saving of elections relating to foreign hybrids
96
Despite the repeal of subsection 485AA(1) of the
Income Tax Assessment Act 1936
by item 37 of this Schedule, elections made under that subsection continue to have effect on and after the commencement of this Schedule as if that repeal had not happened.
Part XI inserted by No 190 of 1992.
Div 1 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part XI heading.
Subdiv A repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part XI heading.
(Repealed by No 114 of 2010)
S 469 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 469 formerly read:
S 469(5) substituted by No 32 of 2006, s 3 and Sch 1 item 14, applicable for an income year that begins on or after 1 July 2006. S 469(5) formerly read:
There are 3 methods provided for making a determination in respect of a FIF. These are called: The method available to the taxpayer in respect of a particular notional accounting period of a FIF generally depends on the level of detailed information that the taxpayer has about the FIF
'
s income and on the method used by the taxpayer to determine whether foreign investment fund income accrued from that FIF in previous notional accounting periods. There are 2 methods provided for making a determination in respect of a FLP. These are called: S 469(8) repealed by
No 143 of 2007
, s 3 and Sch 1 item 125, applicable in relation to income years, statutory accounting periods and notional accounting periods starting on or after the first 1 July that occurs after 24 September 2007. For savings provisions, see note under s
559A
. S 469(8) formerly read:
SECTION 469 TAXPAYERS TO BE TAXED ON SHARE OF INCOME OF CERTAIN FOREIGN INVESTMENT FUNDS AND FOREIGN LIFE ASSURANCE POLICIES
469(1)
This Part applies to a taxpayer who has an interest or interests in what is referred to in this Part as a foreign investment fund (
"
FIF
"
). That expression refers to certain non-resident companies and non-resident trusts.
469(2)
This Part also applies to a taxpayer who has an interest in a foreign life assurance policy (
"
FLP
"
). That expression refers to certain life assurance policies issued by a non-resident. A taxpayer is regarded as having an interest in a FLP if, and only if, the taxpayer has the legal title to the FLP.
469(3)
The object of this Part is to include in a taxpayer
'
s assessable income of a year of income an amount (
"
foreign investment fund income
"
) that represents income attributable to an interest or interests in a FIF or a FLP held by the taxpayer during the accounting period (
"
notional accounting period
"
) of the FIF or FLP that ends in that year of income.
469(4)
The provision of this Act (
"
the operative provision
"
) that includes foreign investment fund income in a taxpayer
'
s assessable income is section
529
, which is contained in Division
16
.
469(5)
The operative provision does not apply, or its application is affected, in certain circumstances which are set out in:
(a)
Divisions
2 to 15
of this Part; and
(b)
section
768-965
of the
Income Tax Assessment Act 1997
.
469(5)
The operative provision does not apply, or its application is affected, in certain circumstances, which are set out in Divisions 2 to 15.
469(6)
Division
18
contains the provisions for determining whether any foreign investment fund income accrued from a FIF or a FLP to a taxpayer in respect of a notional accounting period.
(a)
the market value method;
(b)
the deemed rate of return method;
(c)
the calculation method.
(d)
the deemed rate of return method;
(e)
the cash surrender value method.
469(7)
Division
19
provides for the keeping of accounts to avoid double taxation in respect of interests in FIFs or FLPs.
469(8)
(Repealed by
No 143 of 2007
)
469(8)
Division
20
provides for the recording of the amount of the foreign tax credits allowed in respect of foreign investment fund income.
469(9)
Division
21
contains provisions that apply in certain circumstances if an interest in a FIF or a FLP is disposed of.
469(10)
Division
22
provides for the keeping of records relating to interests in FIFs and FLPs.
S 469 inserted by No 190 of 1992.
Subdiv B repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part XI heading.
(Repealed by No 114 of 2010)
S 470 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 470 formerly read:
"accounts"
"acquisition"
"approved stock exchange"
SECTION 470
SECTION 470 DEFINITIONS
470
In this Part, unless the contrary intention appears:
means ledgers, journals, profit and loss accounts and balance-sheets and includes statements, reports and notes attached to, or intended to be read with, any of the above;
, in relation to an interest in a FIF or a FLP, has the meaning given by section
488
;
means:
(a)
a stock exchange named in regulations made for the purposes of this definition; or
(b)
until regulations are so made
-
a stock exchange named in Schedule 3;
"associate"
has the meaning given by Subdivision E;
"Australian entity"
has the meaning given by section
471
;
"Australian partnership"
has the meaning given by section
472
;
"Australian tax"
means income tax or withholding tax;
"Australian trust"
has the meaning given by section
473
;
"balance-sheet"
includes any similar statement and also includes statements, reports and notes attached to, or intended to be read with, a balance-sheet or similar statement;
"calculation method"
has the meaning given by paragraph
534(2)(c)
;
"CFC"
has the same meaning as in Part
X
;
"CFT"
has the same meaning as in Part
X
;
complying superannuation entity
has the same meaning as in the
Income Tax Assessment Act 1997
.
Definition of " complying superannuation entity " inserted by No 73 of 2004.
complying superannuation/FHSA asset
has the same meaning as in the
Income Tax Assessment Act 1997
.
Definition of " complying superannuation/FHSA asset " inserted by No 45 of 2008, s 3 and Sch 7 item 4, effective 26 June 2008.
"convertible note"
:
(a) in relation to a foreign company, has the same meaning as in Division 3A of Part III ; or
(b) in relation to a foreign trust, means an instrument issued by the trustee of the trust, being an instrument that, if the trust were a company, would be a convertible note issued by the company, and includes an instrument that would be a convertible note within the meaning of Division 3A of Part III if:
(i) references in that Division to a company were references to the trust, or to the trustee of the trust, as the context requires; and
(ii) references in that Division to shares were references to interests in the trust;
"deemed rate of return method"
has the meaning given by paragraph
534(2)(b)
in relation to a FIF and the meaning given by paragraph
534(3)(a)
in relation to a FLP;
"disposal"
, in relation to an interest in a FIF or a FLP, has the meaning given by section
488
;
"distribution"
has the meaning given by section
474
;
"entitled to acquire"
has the meaning given by section
475
;
"entity"
means any of the following:
(a) a company;
(b) a partnership;
(c) a person in the capacity of trustee;
(d) any otherperson;
FIF
or
foreign investment fund
has the meaning given to FIF by section
481
;
fixed entitlement
has the same meaning as in the
Income Tax Assessment Act 1997
.
Definition of " fixed entitlement " inserted by No 73 of 2004.
fixed trust
has the same meaning as in the
Income Tax Assessment Act 1997
.
Definition of " fixed trust " inserted by No 73 of 2004.
"FLP"
or
"foreign life assurance policy"
has the meaning given to FLP by section
482
;
"foreign company"
has the meaning given by section
481
;
"foreign trust"
has the meaning given by section
481
;
"general insurance business"
means insurance business other than life insurance business;
"interest"
, in relation to a FIF or a FLP, has the meaning given by section
483
;
"life insurance business"
has the same meaning as in section 11 of the
Life Insurance Act 1995
;
Definition of " life insurance business " amended by No 5 of 1995.
"Lloyd
'
s"
means The Society of Lloyd
'
s incorporated by the Lloyd
'
s Act 1871 of the United Kingdom;
"market value method"
has the meaning given by paragraph
534(2)(a)
;
"notional accounting period"
:
(a) in relation to a FIF, has the meaning given by section 486 ; or
(b) in relation to a FLP, has the meaning given by section 487 ;
"Part XI Australian resident"
means a resident within the meaning of section
6
but does not include an entity if:
(a) there is a double tax agreement in force in respect of a foreign country; and
(b) that agreement contains a provision that is expressed to apply if, apart from the provision, the entity would, for the purposes of the agreement, be both a resident of Australia and a resident of the foreign country; and
(c) that provision has the effect that the entity is, for the purposes of the agreement, a resident solely of the foreign country;
"profit and loss account"
includes any similar statement and also includes statements, reports and notes attached to, or intended to be read with, a profit and loss account or similar statement;
"quoted price"
has the meaning given by section
476
;
resident superannuation entity
has the meaning given by section
477
.
Definition of " resident superannuation entity " substituted for the definition of " resident Part IX entity " by No 15 of 2007, s 3 and Sch 1 item 128, applicable to the 2007-08 income year and later years. The definition of " resident Part IX entity " formerly read:
"resident Part IX entity"
has the meaning given by section 477 ;
segregated exempt assets
has the same meaning as in the
Income Tax Assessment Act 1997
.
Definition of " segregated exempt assets " inserted by No 73 of 2004.
"share"
, in relation to a foreign company, includes any interest in the capital of the company that is in the nature of a share or stock, including such an interest in the nature of a preference share (whether or not redeemable), a bonus share or a share with deferred rights;
"statutory accounting period"
has the same meaning as in Part
X
;
"tax detriment"
has the meaning given by section
478
;
"the operative provision"
means section
529
;
"trading stock"
(Omitted by No 18 of 1993)
"trust"
means:
(a) an entity in the capacity of trustee (including an entity that manages a trust if there is no trustee); or
(b) as the case requires, a trust or a trust estate;
Definition of " trust " amended by No 15 of 2007, s 3 and Sch 1 item 129, by substituting para (a), applicable to the 2007-08 income year and later years. Para (a) formerly read:
(a) an entity in the capacity of trustee (including an entity that is taken to be a trustee because of section 268 ); or
trustee
, in relation to a fund that has no trustee, means the person who manages the fund.
Definition of " trustee " substituted by No 15 of 2007, s 3 and Sch 1 item 130, applicable to the 2007-08 income year and later years. The definition formerly read:
trustee
, in relation to a fund that has no trustee, means a person who is a trustee of the fund for the purposes of Part IX .
Definition of " trustee " inserted by No 73 of 2004.
virtual PST asset
(Repealed by No 45 of 2008)
Definition of " virtual PST asset " repealed by No 45 of 2008, s 3 and Sch 7 item 3, effective 26 June 2008. The definition formerly read:
virtual PST asset
has the same meaning as in the Income Tax Assessment Act 1997 .
Definition of " virtual PST asset " inserted by No 73 of 2004.
"wholly-owned subsidiary"
has the meaning given by section
479
.
S 470 inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 471 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 471 formerly read:
SECTION 471 AUSTRALIAN ENTITY
471
For the purposes of this Part, each of the following is an Australian entity:
(a)
an Australian partnership;
(b)
an Australian trust;
(c)
an entity (other than a partnership or trust) that is a Part XI Australian resident.
S 471 inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 472 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 472 formerly read:
SECTION 472 AUSTRALIAN PARTNERSHIP
472
For the purposes of this Part, a partnership is an Australian partnership at a particular time if at least one of the partners is an Australian entity at that time.
S 472 inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 473 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 473 formerly read:
SECTION 473 AUSTRALIAN TRUST
473
For the purposes of this Part, a trust is an Australian trust at a particular time (
"
the test time
"
) if:
(a)
at any time in the period of 12 months immediately preceding the test time:
(i)
any trustee of the trust was a resident; or
(ii)
the central management and control of the trust was in Australia; or
(b)
assuming that period had been a year of income:
(i)
the trust would have been a corporate unit trust and a resident unit trust for the purposes of Division
6B
of Part
III
in relation to that year of income; or
(ii)
the trust would have been a public trading trust and a resident unit trust for the purposes of Division
6C
of Part
III
in relation to that year of income.
S 473 inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 474 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 474 formerly read:
SECTION 474 DISTRIBUTIONS BY A FIF OR A FLP
474(1)
Some calculations made under this Part involve taking into account distributions made by a FIF or a FLP to a person who has an interest in the FIF or FLP.
474(2)
A reference in this Part to a distribution made by a FIF or a FLP to a person who has an interest in the FIF or FLP is a reference to any amount paid or credited, or any property distributed, to the person by the FIF or in relation to the FLP that constitutes income derived, or a receipt of capital, by the person and:
(a)
without limiting the generality of the above, includes a reference to:
(i)
the issue by a FIF to a person of a further interest in the FIF in satisfaction of the person's entitlement to a payment by the FIF; and
(ii)
in the case of a FLP
-
any payment to a person of a bonus or a refund of premium under or in respect of the FLP; but
(b)
does not include a reference to the issue by a FIF or a FLP to a person of a further interest in the FIF or FLP without any consideration being paid or given by the person for the interest.
S 474 inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 475 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 475 formerly read:
SECTION 475 ENTITLEMENT TO ACQUIRE
475
For the purposes of this Part, a person is taken to be entitled to acquire anything that the person is absolutely or contingently entitled to acquire, whether because of any constituent document of a company, the exercise of any right or option or for any other reason.
S 475 inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 476 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 476 formerly read:
SECTION 476 QUOTED PRICE
476(1)
It is necessary for the purposes of several provisions of this Part to value an interest in a FIF by reference to the quoted price on a particular day on a stock market of the class of interests in which the interest is included.
476(2)
For the purposes of such a provision, that quoted price is:
(a)
if there was more than one transaction on that stock market on that day in interests in that class
-
the last published price at which such an interest was traded on that stock market on that day; or
(b)
if information as to the price mentioned in paragraph (a) was not published or there were no transactions on that stock market on that day in such interests
-
the last price at which an offer was made on that day to buy such an interest.
S 476 inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 477 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 477 formerly read:
SECTION 477 RESIDENT SUPERANNUATION ENTITY
477
For the purposes of this Part, a trust is a
resident superannuation entity
at a particular time if at that time the trust is:
(a)
an Australian superannuation fund; or
(b)
a complying approved deposit fund or a pooled superannuation trust.
S 477 substituted by No 15 of 2007, s 3 and Sch 1 item 131, applicable to the 2007-08 income year and later years. S 477 formerly read:
SECTION 477 RESIDENT PART IX ENTITY
For the purposes of this Part, a trust is a resident Part IX entity at a particular time if at that time the trust is:
(a)
a resident superannuation fund; or
(b)
a complying ADF, or a PST, as defined by subsection
267(1)
.
S 477 substituted by No 181 of 1994 and inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 478 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 478 formerly read:
SECTION 478 TAX DETRIMENT
478(1)
For the purposes of this Part, each of the following is a tax detriment to a partner in a partnership:
(a)
an increase in an amount included under section
92
in the partner
'
s assessable income in respect of an interest in the net income of the partnership;
(b)
a reduction in an amount allowable under section
92
as a deduction to the partner in respect of the partner
'
s interest in a partnership loss of the partnership;
(c)
a combination of such a reduction to nil and such an increase.
478(2)
For the purposes of this Part, an increase in an amount included under section
97
,
98A
or
100
in the assessable income of a beneficiary in respect of a share of the net income of a trust is a tax detriment to the beneficiary.
478(3)
For the purposes of this Part, an increase (including from nil) in an amount assessable to a trustee under section
98
in respect of a beneficiary
'
s share of, or under section
99
or
99A
in respect of the whole or a part of, the net income of a trust is a tax detriment to the trustee.
478(4)
The amount of the tax detriment is equal to the amount of the increase or reduction or, if paragraph (1)(c) applies, the sum of the amounts of the reduction and increase.
S 478 inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 479 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 479 formerly read:
SECTION 479 WHOLLY-OWNED SUBSIDIARY
479(1)
For the purposes of this Part, a company (
"
the subsidiary company
"
) is taken to be a wholly-owned subsidiary of another company (
"
the holding company
"
) at a particular time if:
(a)
at that time, all the shares in the subsidiary company were owned by:
(i)
the holding company; or
(ii)
a company that is, or 2 or more companies each of which is, a wholly-owned subsidiary of the holding company; or
(iii)
the holding company and a company that is, or 2 or more companies each of which is, a wholly-owned subsidiary of the holding company; and
(b)
there was no agreement, arrangement or understanding in force at that time under which any person was in a position, or would be in a position after that time, to affect rights of the holding company or of a wholly-owned subsidiary of the holding company in relation to the subsidiary company.
479(2)
For the purposes of this section, if a company (
"
the relevant company
"
) is a wholly-owned subsidiary of another company (including a company that is such a wholly-owned subsidiary because of any other application or applications of this subsection), every company that is a wholly-owned subsidiary of the relevant company is taken to be a wholly-owned subsidiary of that other company.
479(3)
For the purposes of subsection (1), a person is taken to be in a position at a particular time to affect any rights of a company (
"
the relevant company
"
) in relation to another company if, at that time, that person has a right, power or option (whether under any provision of the constituent document of either of those companies or under any agreement or instrument or otherwise) to acquire those rights or do an act or thing that would prevent the relevant company from exercising those rights for its own benefit or receiving any benefits accruing because of those rights.
S 479 inserted by No 190 of 1992.
Subdiv C repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part XI heading.
(Repealed by No 114 of 2010)
S 480 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 480 formerly read:
SECTION 480 OUTLINE OF SUBDIVISION
480
This Subdivision explains the meanings of certain key concepts as they are used for the purposes of this Part. For those purposes it is necessary to determine:
(a)
what is meant by a FIF or a FLP (sections
481
and
482
); and
(b)
what is meant by an interest in a FIF or a FLP (section
483
); and
(c)
the taxpayers to whose interests in FIFs or FLPs this Part applies (section
485
); and
(d)
what is a notional accounting period of a FIF or a FLP (sections
486
and
487
).
S 480 inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 481 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 481 formerly read:
S 481(3) amended by No 15 of 2007, s 3 and Sch 1 item 132, by substituting
"
resident superannuation entity
"
for
"
resident Part IX entity
"
in para (a), applicable to the 2007-2008 income year and later years.
SECTION 481 WHAT IS A FIF
481(1)
An entity is a FIF at a particular time if at that time the entity is:
(a)
a foreign company; or
(b)
a foreign trust.
481(2)
A company is a foreign company at a particular time if at that time the company is not a Part XI Australian resident.
481(3)
A trust is a foreign trust at a particular time if:
(a)
at that time the trust is neither an Australian trust nor a resident superannuation entity; and
(b)
the trust did not result from:
(i)
a will, a codicil or an order of a court that varied or modified the provisions of a will or a codicil; or
(ii)
an intestacy or an order of a court that varied or modified the application, in relation to the estate of a deceased person, of the provisions of the law relating to the distribution of the estates of persons who die intestate.
S 481 inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 482 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 482 formerly read:
S 482(1) amended by No 101 of 2004 and No 5 of 1995.
"life assurance policy"
and includes: but does not include: S 482(2) amended by No 5 of 1995.
SECTION 482 WHAT IS A FLP
482(1)
A reference in this Part to a FLP or to a foreign life assurance policy in relation to a taxpayer in relation to a year of income is a reference to a life assurance policy issued by an entity that was not a resident of Australia at any time in that year of income but does not include a policy issued in Australia if the entity that issued the policy was, when the policy was issued, authorised under the
Life Insurance Act 1995
to carry on life insurance business in Australia.
482(2)
In subsection (1):
means a policy insuring payment of money:
(a)
on death (other than death by accident or expressly named sickness only); or
(b)
on the happening of any contingency dependent on the termination or continuance of human life (either with or without provision for a benefit under a continuous disability insurance contract within the meaning of the
Life Insurance Act 1995
);
(c)
an instrument evidencing a contract that is subject to payment of premiums or instalments of premiums for a term dependent on the termination or continuance of human life; or
(d)
an instrument securing the grant of an annuity for a term dependent upon human life;
(e)
such a policy or instrument:
(i)
that provides for the payment of money only on death, or death or permanent disability, and in respect of which the premium, or each of the instalments of premium, is calculated solely by reference to the period:
(A)
for which the human life concerned is expected to continue; or
(B)
within which the human life concerned is expected to terminate; or
(ii)
that was issued before 1 July 1992 but cannot be cancelled, surrendered or redeemed on or after that day and whose terms have not been altered in a material respect on or after that day; or
(f)
a contract between a non-resident and a resident:
(i)
under which the non-resident reinsures the resident against the whole or a part of the liability of the resident under a policy (
"
the relevant policy
"
) issued by the resident; and
(ii)
in respect of which the premium, or each of the instalments of premium, is calculated solely by reference to the period:
(A)
for which the human life to which the relevant policy applies is expected to continue; or
(B)
within which the human life to which the relevant policy applies is expected to terminate.
S 482 inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 483 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 483 formerly read:
SECTION 483 WHAT IS AN INTEREST IN A FIF OR A FLP
483(1)
An interest in a FIF that is a foreign company is:
(a)
a share in the company other than an eligible finance share within the meaning of section
327
; or
(b)
an option, convertible note, or other instrument, that confers an entitlement to acquire such a share.
483(2)
An interest in a FIF that is a foreign trust is:
(a)
an interest in the corpus or income of the trust (including, in the case of a unit trust, an interest constituted by a unit in the unit trust); or
(b)
an option, convertible note, or other instrument, that confers an entitlement to acquire an interest referred to in paragraph (a).
483(3)
A person has an interest in a FLP if the person has the legal title to the FLP and, if only one person has the legal title to the FLP, a reference in this Part to the person
'
s interest or interests in the FLP is taken to be a reference to the FLP.
S 483 inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 484 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 484 formerly read:
SECTION 484 BARE TRUSTEE
'
S INTEREST TO BE ATTRIBUTED TO BENEFICIARY
484(1)
If an interest in a FIF or a FLP is held by a person as trustee for another person who is absolutely entitled to the interest as against the trustee, this Part applies as if the interest were held by the other person and any acts of the trustee were acts of the other person.
484(2)
For the purposes of subsection (1), if a person holds an interest in a FIF or a FLP as trustee for another person, the other person is not taken not to be absolutely entitled to the interest as against the trustee merely because the other person is under a legal disability.
S 484 inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 485 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 485 formerly read:
S 485(1) amended by No 18 of 1993. the operative provision applies to the taxpayer in relation to the FIF in respect of the notional accounting period of that FIF that ended in that year of income. S 485(3) amended by No 18 of 1993. then, subject to subsection (5), the operative provision applies to the taxpayer in relation to the FLP in respect of that notional accounting period. S 485(4) amended by No 18 of 1993. S 485(6) amended by No 15 of 2007, s 3 and Sch 1 item 133, by substituting
"
resident superannuation entity
"
for
"
resident Part IX entity
"
, applicable to the 2007-2008 income year and later years. S 485(6) amended by No 18 of 1993.
SECTION 485 TAXPAYERS TO WHOSE INTERESTS IN FIFs AND FLPs THIS PART APPLIES
485(1)
The operative provision applies to a taxpayer in relation to a FIF or a FLP in accordance with this section. Section
485A
also has effect when the operative provision is applied to work out the net income of a partnership or trust estate.
485(2)
The application of the operative provision to a taxpayer in relation to a FIF or a FLP is to be worked out separately in relation to each notional accounting period of the FIF or FLP.
485(3)
If:
(a)
a taxpayer had an interest or interests in a FIF at the end of a year of income; and
(b)
that year of income is the 1992-93 year of income or a later year of income; and
(c)
the taxpayer was a Part XI Australian resident at any time in that year of income;
485(4)
If:
(a)
a taxpayer had an interest or interests in a FLP at any time during the notional accounting period of the FLP that ends in a year of income; and
(b)
that year of income is the 1992-93 year of income or a later year of income; and
(c)
the taxpayer was a Part XI Australian resident at any time in that year of income;
485(5)
The operative provision does not apply to the taxpayer in relation to a FLP in respect of the 1992-93 year of income if the taxpayer did not have any interest or interests in the FLP at the end of that year of income.
485(6)
Without affecting the circumstances in which, apart from this subsection, a taxpayer would be taken to be a Part XI Australian resident at a time in a year of income, a taxpayer in the capacity of a trustee of a trust that is an Australian trust or a resident superannuation entity at a time in a year of income is taken for the purposes of subsection (3) or (4) to have been a Part XIAustralian resident at that time.
485(7)
The application of the operative provision to a taxpayer in relation to a FIF or a FLP is subject to Divisions 2 to 15.
S 485 inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 485AA repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 485AA formerly read:
If:
The share will be an interest in the partnership that is treated by Division
5A
of Part
III
as a share.
SECTION 485AA ELECTION TO EXCLUDE INTERESTS IN FOREIGN HYBRIDS FROM OPERATION OF THIS PART
485AA(1)
Limited partnerships that are treated as companies.
(a)
disregarding subsection
94D(6)
:
(i)
at the end of a year of income, a taxpayer has an interest in a FIF that is a corporate limited partnership in relation to the year of income; and
(ii)
the interest consists of a share in the FIF; and
Note:
(b) the entity satisfies the requirements of paragraphs 830-10(1)(a) to (d) of the Income Tax Assessment Act 1997 in relation to the year of income;
the taxpayer may elect that subsection (5) of this section applies in relation to the interest in the FIF.
S 485AA(1) amended by No 75 of 2010, s 3 and Sch 1 item 33, by omitting " for the purposes of Division 5A of Part III " after " corporate limited partnership " in para (a)(i), applicable in relation to: (a) payments made; and (b) loans made; and (c) debts forgiven; on or after 1 July 2009.
S 485AA(1) amended by No 58 of 2006 , s 3 and Sch 7 item 178, by substituting " subsection 94D(6) " for " subsection 94D(5) " in para (a), effective 30 June 2004.
485AA(2) Actual companies.
If:
(a) at the end of a year of income, a taxpayer has an interest in a FIF that consists of one or more shares in the FIF; and
(b) the interest is not one to which paragraph (1)(a) applies; and
(c) the entity satisfies the requirements of paragraphs 830-15(1)(a) to (c) of the Income Tax Assessment Act 1997 in relation to the year of income;
the taxpayer may elect that subsection (5) of this section applies in relation to the interest in the FIF.
485AA(3) Time limit for making election.
A taxpayer must make an election under this section:
(a) on or before the day on which the taxpayer lodges its return of income for the year of income; or
(b) within a further time allowed by the Commissioner.
485AA(4) When election is in force.
If the taxpayer makes the election, it is in force during the year of income and all later years of income.
485AA(5) Effect of election on interest in FIF etc.
While the election is in force, the operative provision, and any other provision of this Part relevant to the operation of that provision, does not apply to the taxpayer in relation to the interest in the FIF consisting of the share or shares or any option, convertible note, or other instrument, that confers an entitlement to acquire the share or shares.
Note:
The election will also have the effect under Division 830 of the Income Tax Assessment Act 1997 of making the company or limited partnership a foreign hybrid in relation to the taxpayer's interest in the FIF.
485AA(6) Effect of election on other interests in FIF.
However, subsection (5) does not have effect so far as that interest in the FIF is relevant for the purpose of the application of this Part in relation to the taxpayer, or any other taxpayer, in relation to any other interest in the FIF.
Note:
For example, in applying section 580 to work out other taxpayers ' shares of the calculated profit of the FIF, the interest would not be disregarded.
485AA(7) Election irrevocable.
The election is irrevocable.
S 485AA inserted by No 101 of 2004, s 3 and Sch 10 item 5, effective 30 June 2004. For application provision, see note under s 92(2).
(Repealed by No 114 of 2010)
S 485A repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 485A formerly read:
S 485(1) amended by No 155 of 1997.
SECTION 485A APPLYING OPERATIVE PROVISION IN WORKING OUT NET INCOME OF PARTNERSHIP OR TRUST ESTATE
485A(1)
For the purpose of working out the net income of a partnership or of a trust estate, the operative provision applies as mentioned in section
485
, subject to the following provision.
485A(2)
The requirement in the definition of
"
net income
"
in sections
90
and
95
for assessable income to be calculated as if the partnership or trust estate concerned were a taxpayer who is a resident is, in applying the operative provision, to be taken to be a requirement to calculate that assessable income as if the taxpayer were a Part XI Australian resident.
485A(3)
-
(3A)
(Repealed by No 155 of 1997)
S 485A inserted by No 18 of 1993.
(Repealed by No 114 of 2010)
S 486 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 486 formerly read:
and ended on the next day that is the last day of a notional accounting period of the FIF under whichever of the preceding provisions of this section is applicable.
SECTION 486 NOTIONAL ACCOUNTING PERIOD OF A FIF
486(1)
This section sets out what is a notional accounting period of a FIF for the purposes of the application of this Part to a taxpayer in relation to the FIF.
486(2)
Subject to the following provisions of this section, each period that is a year of income of the taxpayer is a notional accounting period of the FIF.
486(3)
If the accounts of a FIF are made out for periods not exceeding 12 months, the taxpayer may elect that the notional accounting periods of that FIF are to be the respective periods in respect of which the accounts of the FIF are made out.
486(4)
An election made under subsection (3) is irrevocable so long as the taxpayer continues to have an interest in the FIF.
486(5)
Subject to subsection (6), if an election is made under subsection (3):
(a)
the first period (
"
the first period
"
) in respect of which the accounts of the FIF are made out that begins during the year of income of the taxpayer in which the election is made, and all later such periods, are notional accounting periods of the FIF; and
(b)
the period starting at the beginning of that year of income and ending immediately before the beginning of the first period is a notional accounting period of the FIF.
486(6)
If, after the making of an election under subsection (3), any accounts of the FIF are made out for a period exceeding 12 months:
(a)
neither that period, nor any succeeding period exceeding 12 months for which accounts of the FIF are made out, is a notional accounting period of the FIF; and
(b)
the period:
(i)
beginning at the end of the last period in respect of which accounts of the FIF were made out for a period not exceeding 12 months; and
is a notional accounting period of the FIF; and
(ii)
ending at the end of the taxpayer
'
s year of income in which that last period ends;
(c)
all later years of income of the taxpayer are notional accounting periods of the FIF.
486(7)
Despite the preceding provisions of this section, the first notional accounting period of a FIF is the period that:
(a)
in the case of a foreign company:
(i)
if the company was incorporated or established or otherwise came into existence before 1 January 1993
-
began on that day; or
(ii)
if the company was incorporated or established or otherwise came into existence on or after that day
-
began on the day of incorporation or establishment; or
(b)
in the case of a foreign trust:
(i)
if the trust was in existence immediately before l January 1993
-
began on that day; or
(ii)
if the trust came into existence on or after that day
-
began on the day on which the trust came into existence;
S 486 inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 487 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 487 formerly read:
and ended on the next day that is the last day of a notional accounting period of the FLP under whichever of the preceding provisions of this section is applicable.
SECTION 487 NOTIONAL ACCOUNTING PERIOD OF A FLP
487(1)
This section sets out what is a notional accounting period of a FLP for the purposes of the application of this Part to a taxpayer in relation to the FLP.
487(2)
Subject to this section, each period of 12 months ending on 30 June is a notional accounting period of a FLP.
487(3)
If cash surrender values for interests in a FLP are available on a day (a
"
relevant day
"
) during the same month (being one of the 12 months of the calendar year) in each calendar year (whether or not cash surrender values for such interests are also available at other times), the taxpayer may elect that the notional accounting periods of the FLP are to be the periods ascertained under the following provisions of this section.
487(4)
An election made under subsection (3) is irrevocable so long as the taxpayer continues to have an interest in the FLP.
487(5)
Subject to subsection (6), if an election is made under subsection (3):
(a)
the period (
"
the first elective period
"
) beginning immediately after the end of the month in which the last relevant day before the election occurred and ending at the end of the month in which the next relevant day occurs is a notional accounting period of the FLP; and
(b)
each later period beginning after the end of the month in which a relevant day occurs and ending at the end of the month in which the next relevant day occurs is a notional accounting period of the FLP; and
(c)
the period beginning on 1 July immediately preceding the first elective period and ending immediately before the beginning of the first elective period is a notional accounting period of the FLP.
487(6)
If, after the making of an election under subsection (3), a cash surrender value is not available for the taxpayer
'
s interest in a FLP in respect of a relevant day:
(a)
neither the period of 12 months ending on that day nor any following period of 12 months ending on a relevant day is a notional accounting period of the FLP; and
(b)
the period of 12 months beginning on 1 July immediately preceding the period of 12 months first mentioned in paragraph (a) is a notional accounting period of the FLP; and
(c)
all later periods of 12 months beginning on 1 July are notional accounting periods of the FLP.
487(7)
Despite the preceding provisions of this section, the first notional accounting period of a FLP is the period that:
(a)
if the FLP was in existence before 1 January 1993
-
began on that day; or
(b)
if the FLP came into existence on or after that day
-
began on the day on which the FLP came into existence;
487(8)
If the taxpayer disposes of the taxpayer
'
s interest or all of the taxpayer
'
s interest in a FLP, the notional accounting period of the FLP during which the disposal took place ends immediately after the disposal took place.
S 487 inserted by No 190 of 1992.
Subdiv D repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part XI heading.
(Repealed by No 114 of 2010)
S 488 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 488 formerly read:
SECTION 488 WHAT IS A DISPOSAL OR ACQUISITION OF AN INTEREST IN A FIF OR A FLP
488(1)
Some of the provisions of this Part refer to an interest in a FIF or a FLP having been disposed of or acquired and this section determines what is such a disposal or acquisition for the purposes of those provisions.
488(2)
Subject to this section, if a change has occurred in the ownership of an interest in a FIF or a FLP, the change is taken to have effected a disposal of the interest by the person who owned it immediately before the change and an acquisition of the interest by the person who owned it immediately after the change.
488(3)
A change in the legal ownership of an interest is not a change in the ownership of the interest for the purposes of this section unless there is also a change in the beneficial ownership of the interest.
488(4)
A reference in subsection (2) to a change in the ownership of an interest is a reference to a change that has occurred in any way, including any of the following ways:
(a)
by the execution of an instrument;
(b)
by the entering into of a transaction;
(c)
by the transmission of the interest by operation of law;
(d)
by the doing of any other act or thing;
(e)
by the occurrence of any event.
488(5)
Without limiting the generality of subsection (4), a change is taken to have occurred in the ownership of an interest by:
(a)
a declaration of trust in relation to the interest under which the beneficiary is absolutely entitled to the interest as against the trustee; or
(b)
the release, discharge, satisfaction, surrender, forfeiture, expiry, abandonment or extinction, at law or in equity, of the interest; or
(c)
the redemption or buy-back in whole or in part, or the cancellation, of the interest.
488(6)
An issue to a person of an interest in a FIF or a FLP is an acquisition of the interest by the person.
488(7)
None of the following is an acquisition or disposal of an interest in a FIF or a FLP:
(a)
the conversion of a convertible note issued by a FIF into another interest in the FIF pursuant to a right conferred by the convertible note if no consideration is paid or payable in respect of the exercise of that right;
(b)
the exercise of any other right in relation to an interest in a FIF or a FLP if no consideration is paid or payable in respect of the exercise of that right;
(c)
the exchange of an interest in a FIF or a FLP for a different interest in the FIF or FLP of the same value.
S 488 inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 489 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 489 formerly read:
SECTION 489 TIME OF DISPOSAL OR ACQUISITION OF INTEREST
489
If an interest in a FIF or a FLP has been disposed of or acquired, the time of disposal or acquisition is:
(a)
if the interest was disposed of or acquired under a contract
-
the time of making of the contract; or
(b)
otherwise
-
the time of the change in the ownership of the interest that is or gave rise to the disposal or acquisition.
S 489 inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 490 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 490 formerly read:
the person is taken to have received as consideration in respect of the disposal an amount equal to the market value of the interest at the time of the disposal. the person is taken to have paid or given as consideration in respect of the acquisition an amount equal to the market value of the interest at the time of the acquisition.
SECTION 490 CONSIDERATION FOR DISPOSAL OR ACQUISITION
490(1)
In the circumstances referred to in subsections (2) and (3) it is necessary for the purposes of this Part to make special provision for the calculation of the consideration in respect of the disposal or acquisition of an interest in a FIF or a FLP.
490(2)
If a person disposed of an interest in a FIF or a FLP and:
(a)
the person did not receive any consideration in respect of the disposal; or
(b)
both of the following subparagraphs apply:
(i)
the amount that, apart from this subsection, would be taken to be the consideration received by the person in respect of the disposal is greater or less than the market value of the interest at the time of the disposal;
(ii)
the person, and the person to whom the interest was disposed of, were not dealing with each other at arm's length in connection with the disposal;
490(3)
If a person acquired an interest in a FIF or a FLP and:
(a)
the person did not pay or give any consideration in respect of the acquisition; or
(b)
both of the following subparagraphs apply:
(i)
the amount that, apart from this subsection, would be taken to be the consideration paid or given by the person in respect of the acquisition was greater or less than the market value of the interest at the time of the acquisition;
(ii)
the person, and the person from whom the person acquired the interest, were not dealing with each other at arm's length in connection with the acquisition;
S 490 inserted by No 190 of 1992.
Subdiv E repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part XI heading.
(Repealed by No 114 of 2010)
S 491 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 491 formerly read:
Section
960-255
of the
Income Tax Assessment Act 1997
may be relevant to determining relationships for the purposes of subparagraph (2)(a)(iii).
SECTION 491 ASSOCIATES OF AN ENTITY TO BE DETERMINED IN ACCORDANCE WITH SECTION 318 AS MODIFIED
491(1)
For the purposes of this Part, the associates of an entity are to be determined in accordance with section
318
subject to the modifications made by subsection (2) of this section.
491(2)
The modifications are as follows:
(a)
"
relative
"
, in relation to a person, means:
(i)
a spouse of the person other than a spouse who is legally married to the person but is living separately and apart from the person and has been so living for at least 12 months; or
(ia)
a spouse of the person, other than a spouse within the meaning of paragraph (a) of the definition of
spouse
in subsection
995-1(1)
of the
Income Tax Assessment Act 1997
who is living separately and apart from the person and has been so living for at least 12 months; or
(ii)
a child of the person; or
(iii)
if the person has not reached the age of 18 years:
(A)
a parent of the person; or
(B)
a brother or sister of the person;
(b)
"
child
"
, in relation to a person, means:
(i)
a child of the person (other than a child excluded under subsection (3); or
(ii)
a child (other than a child referred to in subparagraph (i)) of a spouse of the person, being a child who lives with the person;
(c)
"
trust
"
does not include a public unit trust, a complying superannuation fund, a non-complying superannuation fund, a complying approved deposit fund, a non-complying approved deposit fund or a pooled superannuation trust;
(d)
subsections
318(5) and (7)
are to be disregarded;
(e)
for the purposes of the application of paragraphs
318(6)(a) and (b)
in relation to an entity, the references in those paragraphs to interposed companies, partnerships or trusts are taken to be references to any such companies, partnerships or trusts that are associates of the entity.
Note:
S 491(2) amended by No 144 of 2008, s 3 and Sch 14 items 42 to 44, by inserting para (a)(ia) after para (a)(i), inserting the note at the end and substituting para (b)(i), applicable in relation to the 2009-2010 year of income and later years of income. Para (b)(i) formerly read:
(i) a child (other than a step-child) of the person; or
S 491(2) amended by No 15 of 2007, s 3 and Sch 1 item 134, by substituting " , a complying superannuation fund, a non-complying superannuation fund, a complying approved deposit fund, a non-complying approved deposit fund or a pooled superannuation trust " for " or an eligible Part IX entity " in para (c), applicable to the 2007-2008 income year and later years.
491(3)
For the purposes of subparagraph (2)(b)(i), the following children are excluded under this subsection:
(a) a step-child of the person; and
(b) someone who would be the step-child of the person except that the person is not legally married to the person ' s spouse.
S 491(3) inserted by No 144 of 2008, s 3 and Sch 14 item 45, applicable in relation to the 2009-2010 year of income and later years of income.
S 491 inserted by No 190 of 1992.
Div 2 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part XI heading.
(Repealed by No 114 of 2010)
S 492 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 492 formerly read:
SECTION 492 OBJECT OF DIVISION
492
The object of this Division is to exempt a taxpayer from taxation in respect of foreign investment fund income that would otherwise be taken to accrue from certain FIFs.
S 492 inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 493 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 493 formerly read:
the operative provision does not apply to the taxpayer in relation to the foreign trust in respect of the notional accounting period of the foreign trust that ends in the year of income.
SECTION 493 EXEMPTION OF ATTRIBUTABLE TAXPAYER IN RELATION TO CERTAIN TRUSTS
493
If an amount of foreign investment fund income that accrued to a taxpayer from a foreign trust in respect of a notional accounting period of the trust would, apart from this section, be included in the taxpayer's assessable income of a year of income and:
(a)
the taxpayer is an attributable taxpayer for the purposes of Division
6AAA
in relation to the year of income and in relation to a trust estate and the trust to which the trust estate relates is the same entity as the foreign trust; or
(b)
the foreign trust is a CFT and the taxpayer is an attributable taxpayer in relation to that CFT at any time during the year of income;
S 493 inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 494 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 494 formerly read:
the operative provision does not apply to the taxpayer in relation to the FIF in respect of the notional accounting period of the FIF referred to in paragraph (a). the operative provision does not apply to the taxpayer in relation to the FIF in respect of the notional accounting period of the FIF referred to in paragraph (a).
SECTION 494 EXEMPTION OF ATTRIBUTABLE TAXPAYER REFERRED TO IN SECTION 456
494(1)
If:
(a)
an amount of foreign investment fund income that accrued to a taxpayer from a FIF in respect of a notional accounting period of the FIF would, apart from this subsection, be included in the taxpayer's assessable income of a year of income; and
(b)
a statutory accounting period of a CFC coincides with that notional accounting period of the FIF; and
(c)
section
456
applies to the taxpayer at the end of the statutory accounting period of the CFC; and
(d)
the CFC is the same entity as the FIF;
494(2)
If:
(a)
an amount of foreign investment fund income that accrued to a taxpayer from a FIF in respect of a notional accounting period of the FIF would, apart from this subsection, be included in the taxpayer's assessable income of a year of income; and
(b)
each of 2 or more statutory accounting periods of a CFC occurs partly within that notional accounting period of the FIF; and
(c)
section
456
applies to the taxpayer at the end of each of those statutory accounting periods of the CFC; and
(d)
the CFC is the same entity as the FIF;
S 494 inserted by No 190 of 1992.
Div 3 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part XI heading.
(Repealed by No 114 of 2010)
S 495 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 495 formerly read:
SECTION 495 OBJECT OF DIVISION
495
The object of this Division is to exempt a taxpayer from taxation in respect of foreign investment fund income that would otherwise be taken to accrue from a foreign company that is taken by the application of one of the methods referred to in section
498
to have been principally engaged in eligible activities at the time determined under section
497
.
S 495 inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 496 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 496 formerly read:
"eligible activities"
SECTION 496 INTERPRETATION
496(1)
In this Division:
means business activities (including the provision of services) other than activities:
(a)
named in regulations made for the purposes of this section; or
(b)
until regulations are so made
-
named in Schedule 4.
496(2)
The inclusion in regulations referred to in paragraph (1)(a), or in Schedule 4, of references to banking, investment, life insurance business, general insurance business, and certain activities in connection with real property, as activities that are not eligible activities does not affect the exemptions provided for by Divisions 4, 5, 6 and 7.
S 496(2) amended by No 82 of 1994.
S 496 inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 497 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 497 formerly read:
SECTION 497 EXEMPTION
497(1)
The operative provision does not apply to a taxpayer in relation to a foreign company in respect of a notional accounting period of the foreign company if the foreign company is taken by one of the methods referred to in section
498
to have been principally engaged in eligible activities at the time (
``the test time''
) applicable under subsection (2).
497(2)
The test time is:
(a)
if the taxpayer uses the stock exchange listing method referred to in section
499
-
the end of the notional accounting period; or
(b)
if the taxpayer uses the balance-sheet method referred to in section
500
:
(i)
if the notional accounting period is a period in respect of which the accounts of the company are made out
-
the end of that period; or
(ii)
if the notional accounting period is the taxpayer's year of income
-
the end of the last period in respect of which the accounts of the company were made out that ended before the end of that year of income.
S 497 inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 498 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 498 formerly read:
SECTION 498 HOW TO DETERMINE WHETHER A FOREIGN COMPANY IS TAKEN TO HAVE BEEN PRINCIPALLY ENGAGED IN ELIGIBLE ACTIVITIES
498(1)
The question whether a foreign company is taken to have been principally engaged in eligible activities at the test time in relation to a notional accounting period is to be determined either:
(a)
by ascertaining, by the stock exchange listing method applicable under section
499
, the designation accorded to the company at the test time by an approved stock exchange or an international sectoral classification system; or
(b)
by ascertaining, by the balance-sheet method applicable under section
500
, the extent to which the company's assets were for use in eligible activities at the test time.
498(2)
If both of those methods are capable of being applied, the question is to be determined in relation to a particular taxpayer by whichever method the taxpayer chooses.
498(3)
If one only of those methods is capable of being applied, the question is to be determined by that method.
498(4)
If neither of those methods is capable of being applied, section
497
does not exempt the taxpayer from the application of the operative provision in relation to the company in respect of the notional accounting period.
S 498 inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 499 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 499 formerly read:
then, irrespective of the extent (if any) to which the company engages in activities that are not eligible activities, the company is taken, for the purposes of the application of section
497
in relation to the taxpayer, to have been principally engaged in eligible activities at that time. included the company in a class of companies designated by the stock exchange or system as engaged in activities of an unclassified kind or of a kind designated as
"
miscellaneous
"
, the company is not taken under subsection (2) to have been principally engaged in eligible activities at that time.
SECTION 499 STOCK EXCHANGE LISTING METHOD
499(1)
The stock exchange listing method may be applied only if the taxpayer
'
s interest or any of the taxpayer
'
s interests in the foreign company at the test time in relation to a notional accounting period was included in a class of interests in the company that were quoted on the stock market of an approved stock exchange.
499(2)
Subject to subsection (3), if the stock exchange listing method applies and at the test time:
(a)
one of the following subparagraphs applies:
(i)
the company was included by an approved stock exchange in a class of companies designated by the stock exchange as engaged in activities of a particular kind;
in a class of companies designated by the system as engaged in activities of a particular kind; and
(ii)
the company was included:
(A)
by an international sectoral classification system named in regulations made for the purposes of this section; or
(B)
until regulations are so made
-
by an international sectoral classification system named in Schedule 5;
(b)
activities of the kind referred to in the designation by the stock exchange or the international sectoral classification system, as the case may be, are eligible activities;
499(3)
If, at the test time:
(a)
if subparagraph (2)(a)(i) applies and subparagraph (2)(a)(ii) does not apply:
(i)
if there was only one approved stock exchange that included the company in a designated class of companies
-
that stock exchange; or
(ii)
if there were 2 or more approved stock exchanges that included the company in a designated class of companies
-
each of those stock exchanges; or
(b)
if subparagraph (2)(a)(ii) applies and subparagraph (2)(a)(i) does not apply:
(i)
if there was only one international sectoral classification system that included the company in a designated class of companies
-
that system; or
(ii)
if there were 2 or more international sectoral classification systems that included the company in a designated class of companies
-
each of those systems; or
(c)
if both subparagraphs (2)(a)(i) and (2)(a)(ii) apply
-
each approved stock exchange and each international sectoral classification system that included the company in a designated class of companies;
499(4)
For the purposes of subsection (3), the designation by an approved stock exchange or an international sectoral classification system of a class of companies as
"
conglomerates
"
or as
"
multi-industry
"
is not taken to be a designation of the companies as being engaged in activities of an unclassified kind or as being designated
"
miscellaneous
"
.
S 499 inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 500 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 500 formerly read:
SECTION 500 BALANCE-SHEET METHOD
500(1)
The balance-sheet method involves determining the extent to which a foreign company's assets were for use in eligible activities by reference to a relevant balance-sheet of the company and, if appropriate, of its subsidiaries prepared as at the test time in relation to a notional accounting period.
500(2)
If, at the test time, the gross value of the foreign company's assets for use in eligible activities was 50% or more of the gross value of all of the company's assets, the company is taken, for the purposes of the application of section
497
in relation to the taxpayer, to have been principally engaged in eligible activities at that time.
500(3)
If, at the test time, a company (
``the holding company''
) was the direct or indirect owner of 50% or more of the paid-up share capital of another company (
``the subsidiary company''
), the following paragraphs apply:
(a)
the gross value at the test time of the holding company's assets for use in eligible activities includes the amount worked out using the formula:
Gross value of subsidiary's eligible assets
×
Interest in share capital
Total share capital
(b) the gross value at the test time of all the holding company's assets does not include the gross value of the shares in the subsidiary company owned by the holding company but includes the amount worked out using the formula:
| Gross value of subsidiary's assets | × |
Interest in share capital
Total share capital |
In the formulas:
`` Gross value of subsidiary's eligible assets '' means the gross value at the test time of the subsidiary company's assets for use in one or more eligible activities;
`` Gross value of subsidiary's assets '' means the gross value at the test time of all the subsidiary company's assets;
`` Interest in share capital '' means the amount of the share capital of the subsidiary company that was owned by the holding company;
`` Total share capital '' means the total amount of the share capital of the subsidiary company.
500(4)
Subsection (3) applies in relation to the subsidiary company whether the subsidiary company engages in eligible activities or activities that are not eligible activities, or both.
500(5)
In subsection (3):
(a) any reference to the holding company's assets does not include:
(i) in the case of the reference in paragraph (3)(a) - a reference to so much of the holding company's assets for use in eligible activities that comprise debts due or other amounts payable to the holding company by the subsidiary company, or by any company interposed between the holding company and the subsidiary company, as are related to the subsidiary company's assets whose gross value is included in the gross value of the holding company's assets for use in eligible activities; or
(ii) in the case of the reference in paragraph (3)(b) - a reference to so much of all the holding company's assets that comprise debts due or other amounts payable to the holding company by the subsidiary company, or by any company interposed between the holding company and the subsidiary company, as are related to the subsidiary company's assets whose gross value is included in the gross value of all the holding company's assets; and
(b) any reference to the subsidiary company's assets does not include a reference to:
(i) shares owned by the subsidiary company in another company that is a subsidiary of the holding company by virtue of Division 6 of Part 1.2 of the Corporations Act 2001 ; or
(ii) assets comprising debts or other amounts payable to the subsidiary company by:
(A) the holding company; or
(B) any company interposed between the subsidiary company and the holding company; or
(C) any other company that is a subsidiary of the holding company by virtue of Division 6 of Part 1.2 of the Corporations Act 2001 .
S 500(5) amended by No 55 of 2001.
500(6)
For the purposes of subsection (3), the percentage of the paid-up share capital of the subsidiary company of which the holding company was the owner at the test time includes the percentage (if any) of that paid-up share capital of which the holding company was the indirect owner at that time, as calculated in accordance with section 501 .
500(7)
Subsections (3) to (6) apply in relation to the ownership by a company of any of the paid-up share capital of another company whether the other company's place of incorporation or establishment is the same as, or different from, the former company's place of incorporation or establishment.
500(8)
If a company had, at the test time, an interest, as a partner in a partnership, in any assets of the partnership:
(a) the gross value at that time of all of the company's assets does not include the value of the company's interest in the partnership as shown in the company's balance-sheet but includes the gross value of the company's interest in each of the partnership's assets; and
(b) the company's assets at that time that were for use in eligible activities are taken to have included the company's interests in the assets of the partnership that were for use in one or more eligible activities.
500(9)
A reference in this section to the gross value of an asset of a company at the test time is a reference to that value as shown in a balance-sheet of the company that:
(a) was prepared in accordance with commercially accepted accounting principles; and
(b) gives a true and fair view of the company's financial position as at that time.
500(10)
For the purposes of this section, the gross value, at the test time, of an asset in which a company has an interest as a partner in a partnership is to be that value as shown in a balance-sheet of the partnership that:
(a) was prepared in accordance with commercially accepted accounting principles; and
(b) gives a true and fair view of the partnership's financial position as at that time.
500(11)
If, at the test time, any of the company's assets ( ``the relevant assets'' ) are for use partly in one or more eligible activities and partly for other purposes, a reference in this section to the gross value at that time of the company's assets for use in one or more eligible activities is a reference to so much only of the gross value at that time of the relevant assets as is proportionate to the extent to which they are for use at that time in one or more eligible activities.
500(12)
If an amount that, under subsection (3) or (8), is to be included in:
(a) the gross value, at the test time, of all the assets of a foreign company; or
(b) the gross value, at that time, of such of those assets as were for use at that time in one or more eligible activities;
is not expressed in the currency in which the balance-sheet applicable under subsection (9) in relation to the foreign company is expressed, the amount to be so included is the equivalent amount expressed in that currency, being the equivalent amount obtained by reference to the appropriate rate of exchange between those 2 currencies in force at that time.
500(13)
A reference in this section to an asset of a company being for use in an eligible activity is a reference to the asset being for use by the company in engaging in that activity either through its directors or employees in the performance of their duties as directors or employees or through another person pursuant to a contract or arrangement.
S 500 inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 501 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 501 formerly read:
and so on, ending with a multiplication by the direct ownership interest that the last interposed company holds in the bottom company.
SECTION 501 INDIRECT OWNERSHIP OF PAID-UP SHARE CAPITAL OF COMPANY
501(1)
For the purposes of this section, a company has a direct ownership interest in another company at a particular time equal to the percentage of the paid-up share capital of the other company of which the first-mentioned company is the owner at that time.
501(2)
The percentage of the paid-up share capital of a company (
``the bottom company''
) of which another company (
``the top company''
) is the indirect owner at a particular time (
``the indirect ownership interest''
) is calculated in accordance with this section.
501(3)
If there is only one company interposed between the top company and the bottom company, the indirect ownership interest is calculated by multiplying the direct ownership interest that the top company holds in the interposed company by the direct ownership interest that the interposed company holds in the bottom company.
501(4)
If there are 2 companies interposed between the top company and the bottom company, the indirect ownership interest is calculated:
(a)
by multiplying the direct ownership interest that the top company holds in the first interposed company by the direct ownership interest that the first interposed company holds in the second interposed company; and
(b)
by multiplying the result of the calculation referred to in paragraph (a) by the direct ownership interest that the second interposed company holds in the bottom company.
501(5)
If there are 3 or more companies interposed between the top company and the bottom company, the indirect ownership interest is calculated:
(a)
by multiplying the direct ownership interest that the top company holds in the first interposed company by the direct ownership interest that the first interposed company holds in the second interposed company; and
(b)
by multiplying the result of the calculation referred to in paragraph (a) by the direct ownership interest that the second interposed company holds in the third interposed company;
S 501 inserted by No 190 of 1992.
Div 4 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part XI heading.
(Repealed by No 114 of 2010)
S 502 repealed by No114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 502 formerly read:
SECTION 502 OBJECT OF DIVISION
502
The object of this Division is to exempt certain taxpayers from taxation in respect of foreign investment fund income that would otherwise be taken to accrue from a foreign company that is a bank or has a wholly-owned subsidiary that is a bank.
S 502 inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 503 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 503 formerly read:
the interest referred to in paragraph (a) is disregarded for the purposes of the application of the operative provision to the taxpayer in relation to the foreign company in respect of that notional accounting period.
SECTION 503 EXEMPTION FOR INTEREST IN FOREIGN BANK
503
If:
(a)
at the end of the notional accounting period of a foreign company the taxpayer had an interest in the foreign company that consisted of shares included in a class of shares that were quoted on the stock market of an approved stock exchange; and
(b)
throughout that period, or the part of that period in which the taxpayer had that interest, as the case may be:
(i)
shares in the foreign company were widely held, and actively traded on a regular basis, on a stock market of an approved stock exchange; and
(ii)
the foreign company was authorised under the law of its place of residence to carry on banking business; and
(iii)
the foreign company was principally engaged in the active carrying on of banking business;
S 503 inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 504 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 504 formerly read:
the interest referred to in subparagraph (a)(i) is disregarded for the purposes of the application of the operative provision to the taxpayer in relation to the holding company in respect of that notional accounting period.
SECTION 504 EXEMPTION FOR INTEREST IN FOREIGN HOLDING COMPANY OF FOREIGN BANK
504
If:
(a)
at the end of the notional accounting period of a foreign company (
"
the holding company
"
) that ended during a year of income:
(i)
the taxpayer had an interest in the holding company that consisted of shares included in a class of shares that were quoted on the stock market of an approved stock exchange; and
(ii)
one of the following sub-subparagraphs applies:
(A)
the holding company was included by an approved stock exchange in a class of companies designated by the stock exchange as engaged in activities of a kind designated as
"
banking
"
or
"
banks
"
;
(B)
the holding company was included by an international sectoral classification system named in regulations made for the purposes of section
499
, or, until regulations are so made, by an international sectoral classification system named in Schedule 5, in a class of companies designated by the system as engaged in activities of a kind designated as
"
banking
"
or
"
banks
"
; and
(b)
throughout that period, or the part of that period in which the taxpayer had that interest, as the case may be:
(i)
shares in the holding company that were included in the class referred to in subparagraph (a)(i) were widely held, and actively traded on a regular basis, on a stock market of an approved stock exchange; and
(ii)
one or more other foreign companies were wholly-owned subsidiaries of the holding company; and
(iii)
if there was only one such subsidiary, that subsidiary was:
(A)
authorised under the law of its place of residence to carry on banking business; and
(B)
principally engaged in the active carrying on of banking business; and
(iv)
if there were 2 or more such subsidiaries:
(A)
at least one subsidiary was authorised under the law of its place of residence to carry on banking business; and
(B)
the principal activities of all the subsidiaries, considered together, were the active carrying on of banking business;
S 504 inserted by No 190 of 1992.
Div 5 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part XI heading.
(Repealed by No 114 of 2010)
S 505 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 505 formerly read:
SECTION 505 OBJECT OF DIVISION
505
The object of this Division is to exempt a taxpayer from taxation in respect of foreign investment fund income that would otherwise be taken to accrue from a foreign company that is taken by the application of the method in section
507
to have been principally engaged in life insurance business at the test time in relation to a notional accounting period. That method involves determining the extent to which the foreign company
'
s assets were for use in carrying on life insurance business at that time by reference to a relevant balance-sheet of the company and, if appropriate, of its subsidiaries prepared at that time.
S 505 inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 506 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 506 formerly read:
SECTION 506 EXEMPTION FOR INTEREST IN FOREIGN LIFE INSURANCE COMPANY
506(1)
The operative provision does not apply to a taxpayer in relation to a foreign company in respect of a notional accounting period of the foreign company if the foreign company is taken to have been principally engaged in carrying on life insurance business at the time (
``the test time''
) applicable under subsection (2).
506(2)
The test time is:
(a)
if the notional accounting period is a period in respect of which the accounts of the company are made out
-
the end of that period; or
(b)
if the notional accounting period is the taxpayer's year of income
-
the end of the last period in respect of which the accounts of the company were made out that ended before the end of that year of income.
S 506 inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 507 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 507 formerly read:
the company is taken, for the purposes of the application of section
506
in relation to the taxpayer, to have been principally engaged in carrying on life insurance business at that time.
SECTION 507 HOW TO DETERMINE WHETHER A FOREIGN COMPANY WAS PRINCIPALLY ENGAGED IN CARRYING ON LIFE INSURANCE BUSINESS
507(1)
The question whether a foreign company is taken to have been principally engaged in carrying on life insurance business at the test time is to be determined as provided by this section.
507(2)
If:
(a)
throughout the notional accounting period referred to in section
506
or the part of that period in which the taxpayer had an interest in a foreign company, the company was authorised under the law of its place of residence to carry on life insurance business; and
(b)
at the test time, the gross value of the foreign company's assets for use in carrying on life insurance business was 50% or more of the gross value of all of the company's assets;
507(3)
If, at the test time, a company (
``the holding company''
) was the direct or indirect owner of 50% or more of the paid-up share capital of another company (
``the subsidiary company''
), the following paragraphs apply:
(a)
the gross value at the test time of the holding company's assets for use in carrying on life insurance business includes the amount worked out using the formula:
Gross value of subsidiary's eligible assets
×
Interest in share capital
Total share capital
(b) the gross value at the test time of all the holding company's assets:
(i) except as provided by subsection (11), does not include the gross value of the shares in the subsidiary company owned by the holding company; but
(ii) includes the amount worked out using the formula:
Gross value of subsidiary's assets × Interest in share capital
Total share capital
In the formulas:
`` Gross value of subsidiary's eligible assets '' means the gross value at the test time of the subsidiary company's assets for use in carrying on life insurance business;
`` Gross value of subsidiary's assets '' means the gross value at the test time of all the subsidiary company's assets;
`` Interest in share capital '' means the amount of the share capital of the subsidiary company that was owned by the holding company;
`` Total share capital '' means the total amount of the share capital of the subsidiary company.
507(4)
Subsection (3) applies in relation to the subsidiary company whether the subsidiary company carries on life insurance business or not.
507(5)
In subsection (3):
(a) any reference to the holding company's assets does not include:
(i) in the case of the reference in paragraph (3)(a) - a reference to so much of the holding company's assets for use in carrying on life insurance business that comprise debts due or other amounts payable to the holding company by the subsidiary company, or by any company interposed between the holding company and the subsidiary company, as are related to the subsidiary company's assets whose gross value is included in the gross value of the holding company's assets for use in carrying on life insurance business; or
(ii) in the case of the reference in paragraph (3)(b) - a reference to so much of all the holding company's assets that comprise debts due or other amounts payable to the holding company by the subsidiary company, or by any company interposed between the holding company and the subsidiary company, as are related to the subsidiary company's assets whose gross value is included in the gross value of all the holding company's assets; and
(b) any reference to the subsidiary company's assets does not include a reference to:
(i) shares owned by the subsidiary company in another company that is a subsidiary of the holding company by virtue of Division 6 of Part 1.2 of the Corporations Act 2001 ; or
(ii) assets comprising debts or other amounts payable to the subsidiary company by:
(A) the holding company; or
(B) any company interposed between the subsidiary company and the holding company; or
(C) any other company that is a subsidiary of the holding company by virtue of Division 6 of Part 1.2 of the Corporations Act 2001 .
S 507(5) amended by No 55 of 2001.
507(6)
For the purposes of subsection (3), the percentage of the paid-up share capital of the subsidiary company of which the holding company was the owner at the test time includes the percentage (if any) of that paid-up share capital of which the holding company was the indirect owner at that time, as calculated in accordance with section 501 .
507(7)
Subsections (2) to (5) apply in relation to the ownership by a company of any of the paid-up share capital of another company whether the other company's place of incorporation or establishment is the same as, or different from, the former company's place of incorporation or establishment.
507(8)
A reference in this section to the gross value of an asset of a company at the test time is a reference to that value as shown in a balance-sheet of the company that:
(a) was prepared in accordance with commercially accepted accounting principles; and
(b) gives a true and fair view of the company's financial position as at that time.
507(9)
If, at the test time, any of a company's assets ( ``the relevant assets'' ) are for use partly in carrying on life insurance business and partly for other purposes, a reference in this section to the gross value at that time of the company's assets for use in carrying on life insurance business is a reference to so much only of the gross value at that time of the relevant assets as is proportionate to the extent to which they are for use at that time in carrying on life insurance business.
507(10)
If an amount that, under subsection (3), is to be included in:
(a) the gross value, at the test time, of all the assets of a foreign company; or
(b) the gross value, at that time, of such of those assets as were for use at that time in carrying on life insurance business;
is not expressed in the currency in which the balance-sheet applicable under subsection (8) in relation to the foreign company is expressed, the amount to be so included is the equivalent amount expressed in that currency, being the equivalent amount obtained by reference to the appropriate rate of exchange between those 2 currencies in force at that time.
507(11)
For the purposes of subsection (2), if, at the test time:
(a) the foreign company referred to in that subsection owned shares in another company which was not a resident of Australia at that time and which at that time managed funds of the foreign company by investing those funds at the discretion of the other company; and
(b) the funds so managed were maintained by the foreign company in a manner similar to the manner in which companies carrying on life insurance business in Australia maintain statutory funds under Part 4 of the Life Insurance Act 1995 ;
the gross value of those shares at that time is to be included in the gross value of all the foreign company's assets, and in the gross value of the foreign company's assets for use in carrying on life insurance business, at that time.
S 507(11)(b) amended by No 5 of 1995.
S 507 inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 507A repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 507A formerly read:
If:
the interest is disregarded for the purposes of the application of the operative provision to the taxpayer in relation to the holding company in respect of that notional accounting period.
SECTION 507A EXEMPTION FOR INTEREST IN FOREIGN HOLDING COMPANY OF FOREIGN LIFE INSURANCE COMPANY
507A(1)
Interest in holding company disregarded.
(a)
at the end of the notional accounting period of a foreign company (the
"
holding company
"
), the taxpayer had an interest in the holding company that consisted of shares included in a class of shares that were quoted on the stock market of an approved stock exchange; and
(b)
the holding company requirements set out in subsection (2) are satisfied; and
(c)
the subsidiary company requirements set out in subsection (3) are satisfied;
507A(2) Holding company requirements.
The holding company requirements are that:
(a) at the end of the notional accounting period, either:
(i) the holding company was included by an approved stock exchange in a class of companies designated by the stock exchange as engaged in the carrying on of life insurance business; or
(ii) the holding company was included by an international sectoral classification system named in regulations made for the purposes of section 499 or, until regulations are so made, by an international sectoral classification system named in Schedule 5, in a class of companies designated by the system as engaged in the carrying on of life insurance business; and
(b) throughout the notional accounting period, or the part of that period in which the taxpayer had the interest in the holding company, as the case may be, shares in the holding company that were included in the class mentioned in paragraph (1)(a) were widely held, and actively traded on a regular basis, on a stock market of an approved stock exchange.
507A(3) Subsidiary company requirements.
The subsidiary company requirements are that:
(a) throughout the notional accounting period (the " interest holding period " ), or the part (also the " interest holding period " ) of that period in which the taxpayer had the interest in the holding company, as the case may be, one or more other foreign companies were wholly-owned subsidiaries of the holding company; and
(b) if there was only one such subsidiary, that subsidiary was:
(i) throughout the interest holding period, authorised under the law of its place of residence to carry on life insurance business; and
(ii) at the test time, principally engaged in the active carrying on of life insurance business; and
(c) if there were 2 or more such subsidiaries:
(i) throughout the interest holding period, at least one subsidiary was authorised under the law of its place of residence to carry on life insurance business; and
(ii) at their test time, the principal activities of all the subsidiaries, considered together, were the active carrying on of life insurance business.
507A(4) " Test time " .
The " test time " in relation to a subsidiary is:
(a) if the notional accounting period is one in respect of which the accounts of the subsidiary are made out - the end of that period; or
(b) if the notional accounting period is the taxpayer ' s year of income - the end of the last period in respect of which the accounts of the subsidiary were made out that ended before the end of that year of income.
507A(5) Single subsidiary - " principally engaged in active carrying on of life insurance business " .
For the purposes of subparagraph (3)(b)(ii), a subsidiary was principally engaged in the active carrying on of life insurance business at the test time if at that time the gross value of its assets for use in carrying on life insurance business was 50% or more of the gross value of all of its assets. For this purpose, subsections 507(3) to (11) (inclusive) apply in the same way as they apply for the purpose of paragraph 507(2)(b) .
507A(6) More than one subsidiary - " principal activities, considered together, were active carrying on of life insurance business " .
For the purposes of subparagraph (3)(c)(ii), the question whether, at their test time, the principal activities of 2 or more subsidiaries, considered together, were the active carrying on of life insurance business is determined as follows:
(a) first, work out for each subsidiary (including by applying subsections 507(3) to (11) (inclusive) in the same way as they apply for the purpose of paragraph 507(2)(b) ):
(i) the gross value, at its test time, of the subsidiary ' s assets for use in carrying on life insurance business; and
(ii) the gross value, at its test time, of all of the subsidiary ' s assets; and
(b) secondly, work out:
(i) the sum of the gross values in subparagraph (a)(i) for all of the subsidiaries; and
(ii) the sum of the gross values in subparagraph (a)(ii) for all of the subsidiaries; and
(c) thirdly, if the sum in subparagraph (b)(i) is 50% or more of the sum in subparagraph (b)(ii), then, at their test time, the principal activities of all of the subsidiaries, considered together, were the active carrying on of life insurance business.
S 507A inserted by No 82 of 1994.
Div 6 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part XI heading.
(Repealed by No 114 of 2010)
S 508 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 508 formerly read:
SECTION 508 OBJECT OF DIVISION
508
The object of this Division is to exempt certain taxpayers from taxation in respect of certain foreign investment fund income that would otherwise be taken to accrue from a foreign company that carries on general insurance business.
S 508 inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 509 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 509 formerly read:
the interest referred to in paragraph (a) is disregarded for the purposes of the application of the operative provision to the taxpayer in relation to the foreign company in respect of that notional accounting period.
SECTION 509 EXEMPTION FOR INTEREST IN FOREIGN GENERAL INSURANCE COMPANY
509
If:
(a)
at the end of the notional accounting period of a foreign company the taxpayer had an interest in the foreign company that consisted of shares included in a class of shares that were quoted on the stock market of an approved stock exchange; and
(b)
throughout that period, or the part of that period in which the taxpayer had that interest, as the case may be:
(i)
shares in the foreign company that were included in that class were widely held, and actively traded on a regular basis, on a stock market of an approved stock exchange; and
(ii)
the foreign company was authorised under the law of its place of residence to carry on general insurance business; and
(iii)
the foreign company was principally engaged in the active carrying on of general insurance business;
S 509 amended by No 18 of 1993 and inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 509A repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 509A formerly read:
If:
the interest is disregarded for the purposes of the application of the operative provision to the taxpayer in relation to the holding company in respect of that notional accounting period.
SECTION 509A EXEMPTION FOR INTEREST IN FOREIGN HOLDING COMPANY OF FOREIGN GENERAL INSURANCE COMPANY
509A(1)
Interest in holding company disregarded.
(a)
at the end of the notional accounting period of a foreign company (the
"
holding company
"
), the taxpayer had an interest in the holding company that consisted of shares included in a class of shares that were quoted on the stock market of an approved stock exchange; and
(b)
the holding company requirements set out in subsection (2) are satisfied; and
(c)
the subsidiary company requirements set out in subsection (3) are satisfied;
509A(2) Holding company requirements.
The holding company requirements are that:
(a) at the end of the notional accounting period, either:
(i) the holding company was included by an approved stock exchange in a class of companies designated by the stock exchange as engaged in the carrying on of general insurance business; or
(ii) the holding company was included by an international sectoral classification system named in regulations made for the purposes of section 499 or, until regulations are so made, by an international sectoral classification system named in Schedule 5, in a class of companies designated by the system as engaged in the carrying on of general insurance business; and
(b) throughout the notional accounting period, or the part of that period in which the taxpayer had the interest in the holding company, as the case may be, shares in the holding company that were included in the class mentioned in paragraph (1)(a) were widely held, and actively traded on a regular basis, on a stock market of an approved stock exchange.
509A(3) Subsidiary company requirements.
The subsidiary company requirements are that, throughout the notional accounting period, or the part of that period in which the taxpayer had the interest in the holding company, as the case may be:
(a) one or more other foreign companies were wholly-owned subsidiaries of the holding company; and
(b) if there was only one such subsidiary, that subsidiary was:
(i) authorised under the law of its place of residence to carry on general insurance business; and
(ii) principally engaged in the active carrying on of general insurance business; and
(c) if there were 2 or more such subsidiaries:
(i) at least one subsidiary was authorised under the law of its place of residence to carry on general insurance business; and
(ii) the principal activities of all the subsidiaries, considered together, were the active carrying on of general insurance business.
S 509A inserted by No 82 of 1994.
Div 7 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part XI heading.
(Repealed by No 114 of 2010)
S 510 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 510 formerly read:
SECTION 510 OBJECT OF DIVISION
510
The object of this Division is to exempt certain taxpayers from taxation in respect of certain foreign investment fund income that would otherwise be taken to accrue from a foreign company that engages in certain activities connected with real property.
S 510 inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 511 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 511 formerly read:
the interest referred to in paragraph (a) is disregarded for the purposes of the application of the operative provision to the taxpayer in relation to the foreign company in respectof that notional accounting period.
SECTION 511 EXEMPTION
511
If:
(a)
at the end of the notional accounting period of a foreign company the taxpayer had an interest in the foreign company that consisted of shares included in a class of shares that were quoted on the stock market of an approved stock exchange; and
(b)
throughout that period, or the part of that period in which the taxpayer had that interest, as the case may be:
(i)
shares in the foreign company that were included in that class were widely held, and actively traded on a regular basis, on a stock market of an approved stock exchange; and
(ii)
the foreign company was principally engaged in the active carrying on of any one or more of the following:
(A)
construction;
(B)
development of real property through capital improvement;
(C)
receipt of rental income from commercial real property owned by the company, being property in respect of which the management, maintenance and security services were principally provided by directors or employees of the company or by a wholly-owned subsidiary of the company that was principally engaged in carrying on the business of providing those services through directors or employees of that subsidiary;
(D)
provision of management services in respect of real property by directors or employees of the company;
(E)
acting as agent in connection with the sale or purchase of commercial real property;
S 511 amended by No 138 of 1994 and inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 511A repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 511A formerly read:
If:
the interest is disregarded for the purposes of the application of the operative provision to the taxpayer in relation to the holding company in respect of that notional accounting period.
SECTION 511A EXEMPTION FOR INTEREST IN FOREIGN HOLDING COMPANY OF FOREIGN REAL PROPERTY COMPANY
511A(1)
Interest in holding company disregarded.
(a)
at the end of the notional accounting period of a foreign company (the
"
holding company
"
), the taxpayer had an interest in the holding company that consisted of shares included in a class of shares that were quoted on the stock market of an approved stock exchange; and
(b)
the holding company requirements set out in subsection (2) are satisfied; and
(c)
the subsidiary company requirements set out in subsection (3) are satisfied;
511A(2) Holding company requirements.
The holding company requirements are that:
(a) at the end of the notional accounting period, either:
(i) the holding company was included by an approved stock exchange in a class of companies designated by the stock exchange as engaged in carrying on one or more of the activities mentioned in subparagraph 511(b)(ii) ; or
(ii) the holding company was included by an international sectoral classification system named in regulations made for the purposes of section 499 or, until regulations are so made, by an international sectoral classification system named in Schedule 5, in a class of companies designated by the system as engaged in carrying on one or more of the activities mentioned in subparagraph 511(b)(ii) ; and
(b) throughout the notional accounting period, or the part of that period in which the taxpayer had the interest in the holding company, as the case may be, shares in the holding company that were included in the class mentioned in paragraph (1)(a) were widely held, and actively traded on a regular basis, on a stock market of an approved stock exchange.
511A(3) Subsidiary company requirements.
The subsidiary company requirements are that, throughout the notional accounting period, or the part of that period in which the taxpayer had the interest in the holding company, as the case may be:
(a) one or more other foreign companies were wholly-owned subsidiaries of the holding company; and
(b) if there was only one such subsidiary - that subsidiary was principally engaged in the active carrying on of one or more of the activities mentioned in subparagraph 511(b)(ii) ; and
(c) if there were 2 or more such subsidiaries - the principal activities of all the subsidiaries, considered together, were the active carrying on of one or more of the activities mentioned in subparagraph 511(b)(ii) .
S 511A inserted by No 82 of 1994.
Div 8 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part XI heading.
(Repealed by No 114 of 2010)
S 512 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 512 formerly read:
SECTION 512 OBJECT OF DIVISION
512
The object of this Division is to exempt a taxpayer from taxation under this Part in respect of foreign investment fund income that would otherwise be taken to accrue from interests in certain entities that are subject to tax in the United States of America.
S 512 inserted by No 93 of 1999; repealed by No 155 of 1997 and inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 512A repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 512A formerly read:
SECTION 512A DIVISION DOES NOT APPLY TO INTERESTS IN CFTs
512A
This Division does not apply in relation to an interest in a CFT.
S 512A inserted by No 93 of 1999.
(Repealed by No 114 of 2010)
S 513 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 513 formerly read:
SECTION 513 EXEMPTIONS
513(1)
The operative provision does not apply to a taxpayer in respect of an interest in:
(a)
an entity that is treated as a corporation, and is subject to tax on its worldwide income, under the Internal Revenue Code of 1986 of the United States of America; or
(b)
a company or trust that is treated as a regulated investment company, or a real estate investment trust, for the purposes of the Internal Revenue Code of 1986 of the United States of America.
513(2)
The operative provision does not apply to a taxpayer in respect of an interest in one of the following entities if the conditions in subsection (3) or (4) are satisfied:
(a)
an entity that is a limited partnership, or a limited liability company under a law of the United States of America or a law of a State of the United States of America;
(b)
an entity that is treated as a common trust fund for the purposes of the Internal Revenue Code of 1986 of the United States of America.
513(3)
The condition in this subsection is that the taxpayer satisfies the Commissioner that:
(a)
the interest that the taxpayer holds at the end of the entity's notional accounting period is held for the sole purpose of investing directly, or indirectly through one or more interposed entities, in:
(i)
a business conducted in the United States of America; or
(ii)
real property located in the United States of America; and
(b)
the entity does not directly, or indirectly through one or more interposed entities (other than through an entity covered by paragraph (1)(a) or (b)):
(i)
have an interest in income or gains derived from sources outside of the United States of America; or
(ii)
hold an interest in a FIF that is not resident in the United States of America; or
(iii)
hold real property that is not located in the United States of America.
513(4)
The condition in this subsection is that the taxpayer satisfies the Commissioner that:
(a)
the interest that the taxpayer holds at the end of the entity's notional accounting period is held for the sole purpose of investing directly, or indirectly through one or more interposed entities, in:
(i)
a business conducted in the United States of America; or
(ii)
real property located in the United States of America; and
(b)
throughout the entity's notional accounting period, the total value of:
(i)
any interests that the entity has in income or gains derived from sources outside the United States of America; and
(ii)
any interests that the entity has in FIFs that are not resident in the United States of America; and
being interests or real property that the entity has or holds directly, or indirectly through one or more interposed entities (other than through an entity covered by paragraph (1)(a) or (b)), does not exceed 5% of the total value of all interests held by the entity in other entities; and
(iii)
any real property held by the entity that is not located in the United States of America;
(c)
throughout the entity's notional accounting period, the value of assets held by the entity that:
(i)
produce income from sources outside the United States of America; or
do not exceed 5% of the total value of assets held by the entity.
(ii)
if disposed of would give rise to a gain from a source outside the United States of America;
513(5)
For the purposes of subsection (4), the value of FIF interests and the value of assets is to be determined using the accounting records of the entity.
S 513 inserted by No 93 of 1999; repealed by No 155 of 1997 and inserted by No 190 of 1992.
Div 9 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part XI heading.
(Repealed by No 114 of 2010)
S 514 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 514 formerly read:
SECTION 514 OBJECT OF DIVISION
514
The object of this Division is to exempt a taxpayer from taxation in respect of foreign investment fund income that would otherwise be taken to accrue from a FIF or a FLP if the value of the interests of the taxpayer and any associates is less than $50,000.
S 514 inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 515 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 515 formerly read:
the operative provision does not apply to the taxpayer in relation to that FIF or FLP in respect of that notional accounting period of that FIF or FLP. whichever is the greater amount.
SECTION 515 EXEMPTION
515(1)
If:
(a)
a taxpayer who is a natural person (otherwise than in the capacity of a trustee) had an interest or interests in a particular FIF or FLP at the end of a notional accounting period of that FIF or FLP; and
(b)
the sum of:
(i)
the values of all the interests of the taxpayer and any associates of the taxpayer in FIFs; and
at the end of the year of income in which that notional accounting period ended did not exceed $50,000;
(ii)
the values of all FLPs in which the taxpayer and any associates of the taxpayer had interests;
515(2)
For the purposes of subsection (1), the value at the end of the year of income of a person's interest in a FIF, or of a FLP in which a person has an interest, is taken to be:
(a)
the cost incurred by the person in acquiring the interest in the FIF or FLP, as the case may be; or
(b)
the market value of the interest in the FIF or of the FLP, as the case may be, at the end of the year of income;
S 515 inserted by No 190 of 1992.
Div 10 repealed by No 32 of 2006, s 3 and Sch 1 item 15, effective 6 April 2006.
(Repealed by No 32 of 2006)
S 516 repealed by No 32 of 2006, s 3 and Sch 1 item 15, effective 6 April 2006. S 516 formerly read:
SECTION 516 OBJECT OF DIVISION
516
The object of this Division is to exempt certain taxpayers who are visitors to Australia from taxation in respect of foreign investment fund income.
S 516 inserted by No 190 of 1992.
(Repealed by No 32 of 2006)
S 517 repealed by No 32 of 2006, s 3 and Sch 1 item 15, effective 6 April 2006. S 517 formerly read:
For the purposes of this section, a person is an exempt visitor to Australia in relation to a year of income if at the end of the year of income:
S 517(2) amended by No 122 of 1997.
SECTION 517 EXEMPTION
517(1)
If a taxpayer is an exempt visitor to Australia in relation to a year of income, the operative provision does not apply to the taxpayer in relation to a FIF or FLP in respect of the notional accounting period of the FIF or FLP that ends in that year of income.
517(2)
[Who is an exempt visitor]
(a)
the person was lawfully in Australia because the person was the holder of a temporary visa (the
current visa
) granted under the
Migration Act 1958
; and
(b)
the period from the time when:
(i)
the current visa; or
was granted until the current visa is due to expire does not exceed 4 years; and
(ii)
if the current visa was granted by way of an extension of a previous temporary visa or of extensions of previous temporary entry visas
-
the earlier or earliest previous temporary visa;
(c)
the person is not awaiting the determination of an application for the grant to the person of permanent residency in Australia under that Act.
517(3)
A reference in subsection (2) to a temporary visa includes a reference to a temporary entry permit granted before 1 September 1994.
S 517(3) inserted by No 122 of 1997.
517(4)
For the purposes of this section, a person who is a citizen of New Zealand is an exempt visitor to Australia in relation to a year of income if:
(a) at the end of that year of income:
(i) the person had not been a resident of Australia for a continuous period exceeding 4 years; and
(ii) had the person not been a citizen of New Zealand, he or she would have been required to be the holder of a temporary visa; and
(b) the person has not come to live in Australia permanently.
S 517(4) inserted by No 122 of 1997.
S 517 inserted by No 190 of 1992.
Div 11 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part XI heading.
(Repealed by No 114 of 2010)
S 518 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 518 formerly read:
SECTION 518 OBJECT OF DIVISION
518
The object of this Division is to exempt a taxpayer from taxation in respect of foreign investment fund income that would otherwise be taken to accrue from a FIF that is an employer-sponsored superannuation fund.
S 518 inserted by No 190 of 1992.
(Repealed by No 114 of 2010)
S 519 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 519 formerly read:
the operative provision does not apply to the taxpayer in relation to that FIF in respect of that notional accounting period.
"employee"
SECTION 519 INTERESTS OF EMPLOYEES AND FORMER EMPLOYEES TO BE EXEMPT
519(1)
If:
(a)
a taxpayer who is a natural person had an interest or interests in a particular FIF at the end of a notional accounting period of that FIF; and
(b)
that FIF was a superannuation fund maintained by an employer, or by an associate of an employer, for the benefit of employees of the employer; and
(c)
the taxpayer had the interest or interests because he or she was such an employee;
519(2)
In this section:
, in relation to an employer, includes:
(a)
a former employee of the employer; or
(b)
if the employer is a company
-
a director or former director of the company.
S 519 inserted by No 190 of 1992.
Div 11A repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part XI heading.
Div 11A heading substituted by No 45 of 2008, s 3 and Sch 7 item 5, effective 26 June 2008. The heading formerly read:
Division 11A - Exemption for virtual PST assets, segregated exempt assets and interests held by complying superannuation entities etc.
Div 11A inserted by No 73 of 2004.
(Repealed by No 114 of 2010)
S 519A repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 519A formerly read:
SECTION 519A OBJECTS OF DIVISION
519A
The objects of this Division are:
(a)
to exempt taxpayers from taxation under this Part in respect of foreign investment fund income that would otherwise be taken to accrue from complying superannuation/FHSA assets or segregated exempt assets; and
(b)
to exempt taxpayers who are trustees of complying superannuation entities or certain fixed trusts from taxation under this Part in respect of foreign investment fund income.
S 519A amended by No 45 of 2008, s 3 and Sch 4 item 4, by substituting " complying superannuation/FHSA " for " virtual PST " in para (a), effective 26 June 2008.
S 519A inserted by No 73 of 2004.
(Repealed by No 114 of 2010)
S 519B repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part
XI
heading. S 519B formerly read:
The operative provision does not apply to a taxpayer in respect of an interest in a FIF that is a complying superannuation/FHSA asset or a segregated exempt asset of the taxpayer.
S 519B(1) amended by No 45 of 2008, s 3 and Sch 4 item 5, by substituting
"
complying superannuation/FHSA
"
for
"
virtual PST
"
, effective 26 June 2008.
SECTION 519B EXEMPTION
519B(1)
Complying superannuation/FHSA assets and segregated exempt assets.
519B(2) Complying superannuation entities.
If a taxpayer is the trustee of a complying superannuation entity in relation to a year of income, the operative provision does not apply to the taxpayer in relation to a FIF in respect of the notional accounting period of the FIF that ends in the year of income.
519B(3) Fixed trusts with various fixed entitlements.
If:
(a) a taxpayer is the trustee of a fixed trust (an interposed fixed trust ) at the end of a year of income; and
(b) one of the following subparagraphs (whether or not the same subparagraph) applies in relation to each of the fixed entitlements to shares of the income and capital of the trust at the end of the year of income:
(i) it is a complying superannuation/FHSA asset;
(ii) it is a segregated exempt asset;
(iii) it is held by the trustee of a complying superannuation entity;
(iv) it is held by the trustee of an interposed fixed trust within the meaning of this subsection or subsection (4);
the operative provision does not apply to the taxpayer in relation to a FIF in respect of the notional accounting period of the FIF that ends in the year of income.
S 519B(3) amended by No 45 of 2008, s 3 and Sch 4 item 6, by substituting " complying superannuation/FHSA " for " virtual PST " in para (b)(i), effective 26 June 2008.
519B(4) Fixed trusts with some fixed entitlements held by former complying superannuation entities.
If a taxpayer is the trustee of a fixed trust (an interposed fixed trust ) at the end of a year of income, where:
(a) some of the fixed entitlements to shares of the income and capital of the trust are held by the trustees of entities that:
(i) are not complying superannuation entities in relation to the year of income; but
(ii) acquired their fixed entitlements in previous years of income and were complying superannuation entities in relation to those years; and
(b) one of the following subparagraphs (whether or not the same subparagraph) applies in relation to each of the other fixed entitlements to shares of the income and capital of the trust at the end of the year of income:
(i) it is a complying superannuation/FHSA asset;
(ii) it is a segregated exempt asset;
(iii) it is held by the trustee of a complying superannuation entity;
(iv) it is held by the trustee of an interposed fixed trust within the meaning of this subsection or subsection (3); and
(c) the market value at the end of the year of income of the fixed entitlements to which paragraph (a) applies is not more than 5% of the market value at that time of all of the fixed entitlements to income and capital of the trust;
the operative provision does not apply to the taxpayer in relation to a FIF in respect of the notional accounting period of the FIF that ends in the year of income.
S 519B(4) amended by No 45 of 2008, s 3 and Sch 4 item 7, by substituting " complying superannuation/FHSA " for " virtual PST in para (b)(i), effective 26 June 2008.
519B(5)
In determining for the purposes of subparagraph (4)(a)(ii) whether an entity was a complying superannuation entity in relation to the year of income in which it acquired the fixed entitlements mentioned in that subparagraph, disregard any notice issued after the end of that year of income under section 40 of the Superannuation Industry (Supervision) Act 1993 to the effect that the entity was not a complying superannuation entity in relation to the year of income.
S 519B inserted by No 73 of 2004.
Div 12 repealed by No 114 of 2010, s 3 and Sch 1 item 37, applicable in relation to the 2010-11 year of income for a taxpayer and later years of income. For saving provisions, see note under Part XI heading.
(Repealed by No 114 of 2010)