Taxation Administration Act 1953


Note: See section 3AA .

Chapter 2 - Collection, recovery and administration of income tax  


Division 12 - Payments from which amounts must be withheld  

Subdivision 12-FB - Payments to foreign residents etc.  



An entity (the payer ) that *carries on an *enterprise must withhold an amount from a payment it makes to another entity, or to other entities jointly, in the course or furtherance of the enterprise if:

(a) the entity receiving the payment, or any of the entities receiving the payment, is an entity covered by subsection (2); and

(b) the payment is of a kind set out in the regulations; and

(c) the payment is not:

(i) a *dividend of a company; or

(ii) interest (within the meaning of Division 11A of Part III of the Income Tax Assessment Act 1936 ); or

(iii) a *royalty; or

(iv) a *departing Australia superannuation payment; or

(v) a payment worked out wholly or partly by reference to the value or quantity of *natural resources produced or recovered in Australia; or

(vi) a *mining payment; or

(vii) an amount represented by or reasonably attributable to a *fund payment; and

(d) the entity receiving the payment is not covered by an exemption in force under subsection 12-319(1) , or at least one of the entities receiving the payment is not covered by an exemption in force under that subsection.

An entity is covered by this subsection if any of the following conditions is satisfied:

(a) the entity is a foreign resident;

(b) the payer believes, or has reasonable grounds to believe, that the entity is a foreign resident;

(c) the payer has no reasonable grounds to believe that the entity is an Australian resident, and either:

(i) the entity has an address outside Australia (according to any record that is in the payer ' s possession, or is kept or maintained on the payer ' s behalf, about the transaction to which the payment relates); or

(ii) the payer is authorised to make the payment at a place outside Australia (whether to the entity or to anyone else);

(d) the entity has a connection outside Australia of a kind set out in the regulations.

Before the Governor-General makes a regulation for the purposes of paragraph (1)(b), the Minister must be satisfied that each payment set out in the regulation is a payment of a kind that could reasonably be related to assessable income of foreign residents.


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