ATO Interpretative Decision
ATO ID 2001/334
Income Tax
Income Tax Exemption - Foreign Superannuation FundFOI status: may be released
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This ATOID provides you with the following level of protection:
If you reasonably apply this decision in good faith to your own circumstances (which are not materially different from those described in the decision), and the decision is later found to be incorrect you will not be liable to pay any penalty or interest. However, you will be required to pay any underpaid tax (or repay any over-claimed credit, grant or benefit), provided the time limits under the law allow it. If you do intend to apply this decision to your own circumstances, you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed. You may wish to obtain further advice from the Tax Office or from a professional adviser.
Issue
Is the trustee of a superannuation fund exempt from income tax on its interest and/or dividend income derived from Australia under paragraph 23(jb) of the Income Tax Assessment Act 1936 (ITAA 1936)?
Decision
The trustee of a superannuation fund, which is a 'foreign superannuation fund' in terms of subsection 6(1) of the ITAA 1936 is exempt from income tax on its interest and/or dividend income derived from Australia under paragraph 23(jb) of the ITAA 1936.
Facts
The fund was established in a country outside Australia.
The fund was established, and is maintained and applied, for the sole purpose of providing superannuation benefits for persons other than persons who are, or would ordinarily be or become, residents of Australia or residents of a Territory of the Commonwealth.
The central management and control of the fund is carried on outside Australia by persons none of whom is a resident of Australia or a resident of a Territory of the Commonwealth.
The fund is not one for which an amount has been set aside, or to which an amount has been paid, by a taxpayer that is an amount that has been allowed or is allowable as a deduction under any provision of the ITAA 1936.
Reasons for Decision
The superannuation fund is a 'foreign superannuation fund' as defined in subsection 6(1) of the ITAA 1936. The trustee of the superannuation fund is therefore exempt from income tax as the fund satisfies the conditions of paragraph 23(jb) of the ITAA 1936. This paragraph exempts the trustee from the liability to pay tax on the income of a superannuation fund, that is a 'foreign superannuation fund' for the purposes of subsection 6(1) of the ITAA 1936 and where its income consists of interest and/or dividend paid by a resident company.
The effect of paragraph 23(jb) together with the subsection 6(1) definition of a 'foreign superannuation fund' is that a foreign superannuation fund which has no connection with Australia other than by virtue of some or all of its funds being invested in Australian interest and/or dividend bearing investments is excluded from the ordinary provisions of the ITAA 1936 relating to the taxation of superannuation funds.
Date of decision: 3 August 2001
Legislative References:
Income Tax Assessment Act 1936
subsection 6(1)
paragraph 23(jb)
ATO ID 2001/320
Keywords
Income Tax Exemptions
Superannuation funds
ISSN: 1445-2782
| Date: | Version: | |
| You are here | 3 August 2001 | Original statement |
| 16 July 2010 | Archived |
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