Tax and Superannuation Laws Amendment (2015 Measures No. 4) Act 2015

(135 of 2015)

[Assented to 13 October 2015]

The Parliament of Australia enacts:

1   Short title

This Act may be cited as the Tax and Superannuation Laws Amendment (2015 Measures No. 4) Act 2015.

2   Commencement

 

(1) Each provision of this Act specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms.

Note: This table relates only to the provisions of this Act as originally enacted. It will not be amended to deal with any later amendments of this Act.

      

(2) Any information in column 3 of the table is not part of this Act. Information may be inserted in this column, or information in it may be edited, in any published version of this Act.

3   Schedules

Legislation that is specified in a Schedule to this Act is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to this Act has effect according to its terms.

Schedule 1   Scrip for scrip roll-over

Income Tax Assessment Act 1997

1   Subsection 104-25(5) (note 4)

Repeal the note.

2   Section 112-53 (table item 2, column headed "In this situation:")

Omit "an ultimate holding company under that arrangement from a member of its wholly-owned", substitute "a member of a wholly-owned group under that arrangement from another member of the".

3   Paragraph 124-780(3)(d)

Omit "arrangement", substitute "*arrangement".

4   At the end of subsection 124-780(3)

Add:

; and (f) if an acquiring entity is a member of a wholly-owned group - no member of the group issues equity (other than a replacement interest), or owes new debt, under the arrangement:

(i) to an entity that is not a member of the group; and

(ii) in relation to the issuing of the replacement interest.

5   Subparagraphs 124-781(1)(a)(i) and (ii)

After " acquiring entity ", insert "and the replacement entity ".

6   Subsection 124-782(1) (note 2)

Omit "an ultimate holding company by an acquiring entity", substitute "a member of an acquiring wholly-owned group by another member of the group".

7   Subsections 124-783(9) and (10)

Omit "acquiring entity" (wherever occurring), substitute "replacement entity".

8   Section 124-784

Repeal the section, substitute:

124-783A Rights that affect stakes

(1) An entity has a significant stake in another entity if:

(a) the first entity has one or more *stake options in the other entity; and

(b) the first entity would have such a stake (under section 124-783) if the first entity acquired *stake interests in the other entity under any of those stake options.

Note: Paragraph (b) is satisfied if there are any circumstances (e.g. the first entity exercises some but not all of the stake options) in which the first entity would have a significant stake in the other entity, even if in other circumstances the first entity would not have such a stake.

(2) An entity, or 2 or more entities, have a common stake in the original entity just before the *arrangement started and in the replacement entity just after the arrangement was completed if:

(a) the entities:

(i) had one or more *stake options in the original entity before the arrangement started; or

(ii) have one or more stake options in the replacement entity; and

(b) the entities would have such stakes (under section 124-783) if:

(i) the entities had acquired *stake interests in the original entity under any of the stake options mentioned in subparagraph (a)(i); or

(ii) the entities acquired stake interests in the replacement entity under some or all of the stake options mentioned in subparagraph (a)(ii).

(3) Something is a stake option an entity has in another entity if it gives the first entity, or its *associates, a right to acquire the following ( stake interests ):

(a) if the other entity is a company:

(i) voting rights in the company; or

(ii) the right to receive any part of any *dividends that the company may pay; or

(iii) the right to receive any part of any distribution of capital of the company;

(b) if the other entity is a trust - the right to receive any part of any distribution to beneficiaries of the trust of income or capital of the trust;

and the acquisition could occur before the end of 5 years after the *arrangement was completed.

Example 1: An option.

Example 2: A share that gives a voting right that is temporarily supressed.

(4) For the purposes of subsection (1), treat the reference in subparagraph (3)(a)(i) to voting rights as being a reference to *shares carrying voting rights.

(5) This section does not limit subsections 124-783(6) to (10).

124-784 Cost base of equity or debt given within acquiring group

Purpose

(1) This section allocates an appropriate *cost base to equity issued, or new debt owed, under the *arrangement, by a member of a *wholly-owned group to another member (the recipient ) of the group, if:

(a) the acquiring entity is a member of the group; and

(b) the cost base of an original interest was transferred or allocated under section 124-782 because the original interest holder is a *significant stakeholder or a *common stakeholder for the arrangement.

Allocation of cost base

(2) The first element of the *cost base of the equity or debt for the recipient is that part of the cost base of the original interest transferred or allocated under section 124-782 as:

(a) may be reasonably allocated to the equity or debt; and

(b) is not more than the *market value of the equity or debt just after the *arrangement was completed.

9   Subparagraph 124-784A(1)(a)(i)

After "section 124-780", insert "or 124-781".

10   Subsection 124-784A(2) (method statement, step 3)

Repeal the step, substitute:

Step 3. Add up the *market value at the completion time of all of the:

(a) if the replacement entity is a company - *shares *on issue by the replacement entity; and

(b) if the replacement entity is a company - options, rights and similar interests issued by the replacement entity that give the holder an entitlement to acquire a share in the replacement entity at or after the completion time; and

(c) if the replacement entity is a trust - units or other interests in the replacement entity; and

(d) if the replacement entity is a trust - options, rights or similar interests issued by the replacement entity that gives the holder an entitlement to acquire a unit or other interest in the replacement entity at or after the completion time.

11   Section 124-784C

Repeal the section, substitute:

124-784C Cost base of equity or debt given within acquiring group

Purpose

(1) This section allocates an appropriate *cost base to equity issued, or new debt owed, under the *arrangement by a member of a *wholly-owned group to another member (the holder ) of the group, if:

(a) an acquiring entity is a member of the group; and

(b) the cost base of the acquiring entity for a qualifying interest was worked out under section 124-784B.

Allocation of cost base

(2) The first element of the *cost base of the equity or debt for the holder is that part of the cost base of the qualifying interest worked out under section 124-784B as:

(a) may be reasonably allocated to the equity or debt; and

(b) is not more than the *market value of the equity or debt at the completion time.

12   Subsection 995-1(1) (definition of common stake)

Omit "section 124-783", substitute "sections 124-783 and 124-783A".

13   Subsection 995-1(1) (definition of significant stake)

Omit "section 124-783", substitute "sections 124-783 and 124-783A".

14   Subsection 995-1(1)

Insert:

stake interest has the meaning given by subsection 124-783A(3).

stake option has the meaning given by subsection 124-783A(3).

15   Application of amendments

The amendments made by this Schedule apply in relation CGT events happening after 7.30 pm, by legal time in the Australian Capital Territory, on 8 May 2012.

Schedule 2   Foreign employment income and Australian government employees

Income Tax Assessment Act 1936

1   Paragraph 23AG(1AA)(a)

After "employer", insert "(except if that employer is an Australian government agency (within the meaning of the Income Tax Assessment Act 1997))".

2   Application of amendments

The amendment made by this Schedule applies to the 2016-17 year of income and later years of income.

Schedule 3   Lost member small account threshold

Superannuation (Unclaimed Money and Lost Members) Act 1999

1   Paragraph 24B(1)(b)

Omit "$2,000", substitute "$4,000".

Note: This item commences on 31 December 2015.

2   Paragraph 24B(1)(b)

Omit "$4,000", substitute "$6,000".

Note: This item commences on 31 December 2016.