The PRESIDENT (Senator the Hon. Stephen Parry) took the chair at 10 am, read prayers and made an acknowledgement of country.
Australian Citizenship Amendment (Intercountry Adoption) Bill 2014
Whilst Australia has signed the convention, it is difficult for Australia to monitor the systems in countries that are adopting children that have not signed the convention. For this reason, I think promoting bilateral agreements with non-Hague countries and finalising adoptions in overseas countries have lots of risks associated. So I do not support this bill.
… we emphasise the best interests of the child test. We note that the CRC, the Convention on the Rights of the Child, talks about 'primary' interests of children whereas the Hague convention talks about consideration of children being 'paramount' in intercountry adoption. UNICEF would not support any dilution of those standards …
In the very first instance, the Convention on the Rights of the Child says that a child should be with its own family.
In all circumstances, that is what we should be striving for. If that is not possible—and that is also about why we do development, to try to bolster systems to ensure that children and families can be supported—then that child should stay in its own culture and with family members or extended family members in that country. Again, our job is to help build systems with those foreign governments to make sure those child protection systems are strengthened before we get into this.
… … …
If all of that is exhausted—in a way, the convention says that intercountry adoption should be a last resort after those have been exhausted—then we look at how best we can minimise and protect.
… it takes time and due diligence and also that children are genuinely available to be adopted. We do not want to see any more cases where parents adopt into the Australian context only to discover that the child should never have been considered genuinely available for adoption. That is a really complex thing for parents to have to live with. What does that mean then for your parenting, what is meant for your family, what does it mean for the child, what does it mean for the biological family?
The more bilateral agreements we have with non-Hague countries, the more unethical and unlawful adoptions we are going to have.
… it has been noted in other country contexts that sometimes there is not due process around free, prior and informed consent from parents and situations where parents are actually being pressured to surrender their children to adoption programs.
Also, we are funded by the New South Wales government support service for adult adoptees to search for their birth parents overseas. It is important to understand how much of a profound impact that can have on adoptees in later life when they become an adult to find out that their adoption was unethical and unlawful.
The committee recommends that the child protection principles set out in the Hague Convention, particularly the overarching requirement that the best interests of the child be the paramount consideration in intercountry adoption processes, be explicitly articulated in Australia's bilateral arrangements and, where relevant, in the related legislation and regulations.
While not directly relevant to the committee's terms of reference, the committee strongly urges Commonwealth, state and territory governments to ensure that adequate resourcing and priority is provided for follow up monitoring and support to ensure that it fully addresses Australia's obligations to adoptees throughout the adoption cycle, regardless of whether adoptions take place under the Hague Convention or under bilateral arrangements.
That the bill does not focus on the best interests of the child …
That the bill could facilitate an environment for forced or coerced adoption practices to take place …
Given that all of the country programmes which the Australian Government has established must meet the standards of the Hague Convention, the government is of the view that Australia’s intercountry adoption programme as a whole is consistent with Article 21 of the CRC.
That this bill be now read a third time.
That government business order of the day no. 2, Crimes Legislation Amendment (Psychoactive Substances and Other Measures) Bill 2014, be postponed to a later hour of the day.
Crimes Legislation Amendment (Unexplained Wealth and Other Measures) Bill 2014
… for every crime, there is a victim of crime. Therefore, if you prevent a crime or deter the commissioning of a crime, there is one less victim.
… committed to ensuring that it has strong laws to target the criminal economy; not only removing the proceeds of crime, but also preventing its reinvestment into further criminal activity.
… not expecting a huge volume of unexplained wealth cases.
… if a person does need to resort to legal aid there are ways for them to do that and for the legal aid commission to recoup those costs.
The AFP added that the existing provisions, which provide for a person to access restrained assets for the purpose of legal expenses, have been found to be the 'type of provision [that] undermined the entire object of the act because ... people would rather spend their money on their lawyers than see the money going to be confiscated by law enforcement'.
The importance of serious and organised crime had already been recognised internationally, with a 1997 Interpol resolution recommending that member countries consider adopting effective laws, that give law enforcement officials the powers they need to combat money laundering both domestically and internationally, including reversing the burden of proof (using the concept of reverse onus) in respect of the confiscation of alleged proceeds of crime.
The idea of confiscation of unexplained wealth in international agreements can be traced back as far as the United Nations Convention against Illicit Traffic in Narcotic Drugs and Psychotropic Substances (1988).
Once, encounters with organised crime were largely restricted to those who sought out illicit commodities or illegal activities. Today, any Australian on any day can be …
No free man shall be seized or imprisoned, or stripped of his rights or possessions, or outlawed or exiled, or deprived of his standing in any other way, nor will we proceed with force against him, or send others to do so, except by the lawful judgment of his equals or by the law of the land.
Under Commonwealth unexplained wealth legislation, if a court is satisfied that there are reasonable grounds to suspect that a person's total wealth exceeds the value of the person's wealth that was lawfully acquired, the court can compel the person to attend court and prove, on the balance of probabilities, that their wealth was not derived from one or more relevant offences. If a person cannot demonstrate this, the court may order them to pay to the Commonwealth the difference between their total wealth and their legitimate wealth.
Courts hearing unexplained wealth matters currently have a general discretion to decline to make a restraining order, preliminary unexplained wealth order or final unexplained wealth order, even if all relevant criteria for making the orders have been satisfied. The Bill will remove this discretion and will require courts to make [those orders] once satisfied that the criteria for making them have been met.
…Islam has such permeable borders, such an absence of hierarchy, that anyone can become anything in their own mind. Its symbols are available to anyone who wants to claim them and there is nothing anyone can do to stop them. Australian Muslims had been disowning Monis for at least seven years. They'd even expressed their concerns to the authorities. But how can you stop the 'fake sheikh' being real to himself? There's no control order regime to account for this. There's no metadata inside an apparently deranged mind. We're busy fretting about the terrorists' tools of the future—which is all fair enough—while they wreak havoc with the tools of the past.
But there's another history to be written here. One that is very much in control. It's a history written not just in the statements of leaders, but in the minutiae of our everyday interactions. It's the history we glimpsed as the siege unfolded when a single, humble Australian decided to declare #illridewithyou in solidarity with Muslims too scared to ride public transport. It's a history that commenced with the interfaith vigil held at the Lakemba and Auburn mosques. And it's a history to be determined by what we decide this tragedy symbolises: the sordid ideology of a man who deserves to be forgotten or the greatest virtues of those of us left behind.
Crimes Legislation Amendment (Unexplained Wealth and Other Measures) Bill 2014
When the proceeds of crime legislation was brought in in 1987 there was an ability for suspects to access assets that had been restrained, for legal costs. We believe that that system was abused. It was used by suspects to frustrate the system and, basically, siphon off the assets that had been restrained.
It is true that legal aid commissions can be reimbursed for the cost of these cases, but a case must be finalised and a bill of costs provided … before reimbursement occurs.
As cases can run for many years, significant sums of money can be spent along the way…
(1) Schedule 1, item 3, page 3 (lines 9 and 10), to be opposed.
(2) Schedule 1, item 24, page 9 (line 3) to page 11 (line 10), to be opposed.
That schedule 1 item 3 and item 24 stand as printed.
That the bill stand as printed.
That the bill be reported.
The Senate divided. [12:54]
(Temporary Chairman—Senator Bernardi)
That the report of the committee be adopted.
That the bill be read a third time.
Crimes Legislation Amendment (Psychoactive Substances and Other Measures) Bill 2014
Debate resumed on the motion:
That this bill be now read a second time.
If this law were passed we would have to immediately conduct a massive audit of every single herb that is sold throughout our retail outlets…. There are potentially an awful lot of herbs that could fall under the remit of the legislation. So we would have to immediately figure out which herbs were going to be affected and revamp a lot of our catalogues and our online shop and negotiate with our suppliers and manufacturers to create different products.
ABBOTT MINISTRY
23 DECEMBER 2014
Each box represents a portfolio. Cabinet Ministers are shown in bold type. As a general rule, there is one department in each portfolio. However, there is a Department of Human Services in the Social Services portfolio and a Department of Veterans' Affairs in the Defence portfolio. The title of a department does not necessarily reflect the title of a minister in all cases.
… we cannot govern the country through belligerence and hubris.
We cannot govern ourselves in an internal climate of fear and intimidation. And that is the unacceptable situation we have endured for the past five years.
Again, what I’m going to do in terms of the leadership debate, is be consistent. And consistently, I say that I support the Prime Minister, and I support our Prime Minister because of what she’s got done in this period of the minority government.
I do think that offshore processing is clearly not working and those centres need to close down.
I'm very pleased with the decision of the Prime Minister … it now commits the Government to a full and open tender …
… we have run out of time … and we need to make decisions now.
I've been able to extract a commitment from government.
Our appeal to Senators—
as they return to Canberra is not to ignore the opportunity they have to negotiate with the Government in amending and passing a legislative package that … delivers the quality of education that students and parents expect.
The father of the modern university system, former Labor minister John Dawkins, has backed fee deregulation and urged the party not to lock itself out of sensible reforms.
… the position today is the same as the position was last week, and I’m pleased that Sean’s happy about that.
That the Senate records its deep regret at the death on 7 January 2015 of the Honourable Keppel (Kep) Earl Enderby QC, former minister and member for the Australian Capital Territory and Canberra, places on record its appreciation of his long and meritorious public service and tenders its profound sympathy to his family in their bereavement.
The proscribing of racial discrimination in legislative form will require legal sanctions. These will also make people more aware of the evils, the undesirable and unsociable consequences of discrimination-the hurtful consequences of discrimination- and make them more obvious and conspicuous.
That the Senate records its deep regret at the death on 26 January 2015 of the Honourable Thomas (Tom) Uren, AC, former minister and Member for Reid, places on record its appreciation of his long and meritorious public service and tenders its profound sympathy to his family in their bereavement.
We didn't hear any noise, just witnessed that vivid crimson sky.
And we didn't see the mushroom cloud, but we saw the discolouration of the sky and it was that crimson colour, that beautiful sunset magnified about a hundred times over. And you could never really forget that graphic description, colour, of the sky that day.
We were living by the principle of the fit looking after the sick, the young looking after the old, the rich looking after the poor.
When Tom poured his belief into you, it was like standing beneath a waterfall from which you emerged a larger version of yourself.
… uncontrolled development, economic growth and 'progress' to that time had had a very detrimental effect on Australia's national estate … and called for … prompt action and public education to prevent further neglect and destruction.
… components of the natural environment of Australia or the cultural environment of Australia, that have aesthetic, historic, scientific or social significance or other special value for future generations as well as for the present community.
I want to help build an environmentally sensitive, beautiful and more tolerant world.
Like most Labor leaders of his time, Uren paid scant attention to the economy. He lost more economic arguments than he won in the last 25 years of the 20th century …
During my years under Whitlam as Minister for Urban and Regional Development and later as Minister for local government under Bob Hawke, I have been involved in most regions of the country. I am most proud of our achievements in saving old parts of Sydney such as Woolloomooloo and Glebe, of our sewerage works, the redirection of freeways away from living areas, the creation of the Australian Heritage Commission and the development of the regional centre of Albury-Wodonga, as well as many parks in the west of Sydney and along the Georges River. … I have had a very exciting life and many great opportunities.
We have a wonderful country with a magnificent future as long as we do not put it in pawn to foreign capital.
… one of the most determined, arrogant, egotistical, opinionated, loving, humble and genuine men I have ever met.
Tom Uren may not have believed in God, but God sure believed in him.
You couldn't walk down the street alongside him without feeling the warmth that people had for him. People truly loved him.
(a) on 13 January 2015, of Keith Webb Wright, a member for the division of Capricornia, from 1984 to 1993; and
(b) on 24 January 2015, of Eric John Fitzgibbon, a member for the division of Hunter from 1984 to 1996.
That the following general business orders of the day be considered on Thursday, 12 February 2015 under the temporary order relating to the consideration of private senators' bills:
No. 23 Trade and Foreign Investment (Protecting the Public Interest) Bill 2014.
No. 41 Mining Subsidies Legislation Amendment (Raising Revenue) Bill 2014.
That leave of absence for personal reasons be granted to Senator McEwen for the 9th to the 12th of February 2015.
That the following matter be referred to the Community Affairs References Committee for inquiry and report by 28 April 2015:
The details of Australia‘s bid to host the 2022 FIFA World Cup, and in particular:
(a) the use of public funds;
(b) the tactics adopted;
(c) the individuals involved;
(d) the allegations of corruption contained in Mr Michael Garcia‘s report to the Fédération Internationale de Football Association (FIFA); and
(e) other matters pertaining to potentially inappropriate behaviour in relation to the bid.
That the Joint Committee of Public Accounts and Audit be authorised to hold private meetings otherwise than in accordance with standing order 33(1), during the sittings of the Senate, as follows:
(a) Thursday, 12 February 2015, from 10.30 am;
(b) Thursday, 5 March 2015, from 10.30 am, followed by a public meeting;
(c) Thursday, 19 March 2015, from 10.30 am, followed by a public meeting; and
(d) Thursday, 26 March 2015, from 10.30 am, followed by a public meeting.
That the Senate acknowledges and encourages the efforts of Indigenous groups across the nation working in partnership with resource companies to provide employment, training and educational opportunities to local Aboriginal populations, where mining activity is occurring on their traditional land.
That—
(a) there be laid on the table by the Minister representing the Minister for Health, no later than 3.30 pm on Wednesday, 11 February 2015, copies of the following National Mental Health Commission documents in relation to its Mental Health review, as referred to during the estimates hearing of the Community Affairs Legislation Committee on Wednesday, 22 October 2014:
(i) the preliminary report completed during February 2014, and
(ii) the interim report completed in June 2014; and
(b) the Senate not accept a public interest immunity claim by the Minister that tabling these documents would impact the Government's ability to properly respond to the Mental Health Review because:
(i) the production of these documents is necessary to allow people living with mental illness, their representative organisations and service providers to have an open and honest conversation about the future of the mental health system in Australia,
(ii) the Mental Health Review must be transparent for the community to have faith in the review outcomes,
(iii) there has been significant demand from the mental health sector, including consumers, for the reports to be made available, and
(iv) the more than 1 800 organisations and individuals that made submissions to the review have the right to see these reports.
That the Senate—
(a) notes statements of support for the Boycott, Divestment and Sanctions (BDS) campaign against Israel, including the Victoria Trades Hall Council's recent reiteration of its support for the BDS strategy; and
(b) denounces such support as anti-Semitic, ill-informed, simplistic, inflammatory and having no place in our society.
That the following bill be introduced: A bill for an act to establish the Australian Centre for Social Cohesion and for related purposes.
That this bill may now proceed without formalities and be read a first time.
That the Senate—
(a) notes the motion passed in the South Australian House of Assembly on Wednesday, 3 December 2014, with the support of Labor, Liberal and crossbench members, that:
(i) condemned the remarks of the Commonwealth Minister for Defence that he would not trust the Australian Submarine Corporation (ASC) to 'build a canoe',
(ii) reaffirmed its support for ASC workers and all other South Australians employed in the Defence industry,
(iii) demanded That the Abbott Liberal Government upholds its election commitment to build the 12 future submarines in Adelaide, and
(iv) noted that Australians should have the right to trust the word of its leaders when it comes to decisions that affect the national security of this country; and
(b) concurs with the sentiments expressed by the South Australian House of Assembly.
That the Senate—
(a) notes that:
(i) on 13 October 2014, the British House of Commons passed a motion to recommend the United Kingdom recognise the state of Palestine, and
(ii) the state of Palestine is currently recognised by 135 states; and
(b) supports the passage of the same motion as that supported by the British House of Commons, namely, the Government should recognise the state of Palestine alongside the state of Israel, as a contribution to securing a negotiated two state solution.
(a) notes:
(i) the Abbott Government's failure to propose and deliver revenue measures that target the big end of town, instead of the sick, the young and the poor, and
(ii) the billions in foregone revenue from corporate tax avoidance in Australia that could be recouped simply by enforcing current laws; and
(b) calls on the Treasurer (Mr Hockey) to do more to crack down on corporate tax avoidance in Australia instead of persisting with cruel budget measures that have been rejected by the Australian people.
That the Senate—
(a) notes the Government of Brunei Darussalam's recently adopted penal code, which threatens the human rights of minority groups, including women, religious minorities and lesbian, gay, bisexual and transgender individuals; and
(b) calls on the Government to insist that Brunei address these human rights violations as a condition of it participating any further in the Trans-Pacific Partnership trade negotiations.
Pursuant to standing order 75, I propose that the following matter of public importance be submitted to the Senate for discussion:
The chaos, division, dysfunction and mistrust at the heart of the Coalition Government.
Leading Australian housing researcher, Professor Patrick Troy describes the funding situation under the CSHA:
Most of the Commonwealth funds advanced to the States since the 1945 CSHA were actually repayable interest bearing grants (the average citizen held the mistaken belief that a 'grant' was just that when in the arcane language of the Commonwealth it was actually a 'loan').
One consequence of this was that each year the States were forced deeper into debt and was one reason they could not fund the needed infrastructure. It was a neat pea and thimble trick.
Our defence force is one of the best in the world because of its people and the very least we can do is to ensure that their wages are not diminished.
2010
June 23—Then deputy prime minister, Gillard challenges Rudd to a leadership ballot as his popularity plummets following a series of policy mis-steps including shelving an emissions trading scheme and skirmishes with the powerful mining industry over tax hikes.
June 24—Gillard goes on to win unopposed, with Rudd declining to contest the ballot. She quickly calls national elections.
August 21—The Labor party fails to win a majority, prompting Australia's first electoral deadlock in 70 years.
September 7—Minority lawmakers throw their support behind Gillard after lengthy negotiations, ensuring Labor's return to power with a fragile coalition. Gillard appoints Rudd as foreign minister.
2011
March 8—Gillard's popularity drops to a record low amid plans for a pollution levy, despite pledging there would be no such tax under her government. Furious protests break out around the country.
August 31—High Court strikes down Gillard's refugee swap deal with Malaysia, seen as a solution to the inflammatory issue of boat people, forcing Labor to scrap offshore processing and release refugees.
November 8—Labor passes its controversial emissions reduction scheme, but fails to make any headway in the polls. Rudd consistently places ahead of Gillard as preferred leader.
2012
February 22—Rudd resigns as foreign minister in Washington and says he is returning home to consider his future.
February 23—Gillard calls a leadership ballot and says both contenders must accept the outcome as final.
February 27—Gillard wins the ballot with a commanding 71 votes to 31 and vows to lead a unified front to the 2013 election. Rudd promises full support and says he holds no grudges.
2013
January 30—Amid renewed talk about Gillard's leadership, she announces national elections for September 14.
February 15—Rudd dismisses mounting speculation he will again challenge Gillard, telling everyone to take 'a long, cold shower'.
March 12—An opinion poll shows Gillard would be crushed in a national election, but Labor would easily win if Rudd was leader.
March 21—Senior cabinet minister Simon Crean demands Gillard call a leadership vote and urges Rudd to stand. Gillard immediately calls a ballot but Rudd declines to challenge and she retains the leadership unopposed. Rudd vows not to challenge again.
June 26—After weeks of rising speculation Gillard announces a party leadership ballot cutting short party-room moves to depose her. Both Rudd and the prime minister commit to quit politics if they lose.
Rudd wins the ballot by 57 votes to 45.
… for too long, Kevin Rudd has been putting his own self-interest ahead of the interests of the broader labour movement and the country as a whole, and that needs to stop.
The Party has given Kevin Rudd all the opportunities in the world and he wasted them with his dysfunctional decision making and his deeply demeaning attitude towards other people including our caucus colleagues.
He sought to tear down the 2010 campaign, deliberately risking an Abbott Prime Ministership, and now he undermines the Government at every turn.
He was the Party's biggest beneficiary then its biggest critic; but never a loyal or selfless example of its values and objectives.
For the interests of the labour movement and of working people, there is too much at stake in our economy and in the political debate for the interests of the labour movement and working people to be damaged by somebody who does not hold any Labor values.
Senior Minister Penny Wong came to her in tears. She, too, was abandoning Gillard. Why? “It’s the South Australian seats,’’ Wong replies.
“I knew then that I’d lost it,’’ Gillard said.
Mr Shorten did not believe he had been dishonest in telling the media over the past two weeks he was still supporting Ms Gillard.
"As I was going through the process of thinking what to do, do you think it is my job to be a public worrywart? That just destabilises the situation," he said.
"Up until the spill ... I was going to support the prime minister."
She acknowledged that removing Mr Rudd from The Lodge in 2010 was "an act of political bastardry" but she said it was only possible "because Kevin had been such a bastard himself".
Migration and Maritime Powers Legislation Amendment (Resolving the Asylum Legacy Caseload) Bill 2014
Crimes Legislation Amendment (Psychoactive Substances and Other Measures) Bill 2014
(1) Schedule 2, item 14, page 16 (lines 17 to 24), to be opposed.
(2) Schedule 2, item 18, page 21 (lines 13 to 18), section 361.5 to be opposed.
The Senate divided. [18:11]
(The Chairman—Senator Marshall)
psychoactive effect , in relation to a person, means:
(a) stimulation or depression of the person’s central nervous system—
resulting in hallucinations or in a significant disturbance in, or significant change to, motor function, thinking, behaviour, perception, awareness or mood; or
(b) causing a state of dependence, including physical or psychological addiction.
That this bill be now read a third time.
Intellectual Property Laws Amendment Bill 2014
I can clarify and make the point that currently the Patents Act does have Crown use provisions in it. The components that were removed from the amendment bill were proposed changes to the existing provisions. I do not want you to interpret that there are no Crown use provisions in the legislation at present.
I wish to remind all in this place that breaking an international treaty is no small matter. It is not a trifling matter. The Commonwealth exposes itself to the full weight of the sanctions of the WTO. How reckless and irresponsible a measure to endanger the economic sustainability of the nation and the livelihoods of millions. To entrench the budgetary emergency borders on treason. Forgive my incredulity, but the Gillard government is actually rushing to this treason.
That this bill be now read a third time.
Tax Laws Amendment (Research and Development) Bill 2013
Directors’ confidence in the Federal Coalition Government has slumped to its lowest level since its election in September 2013 and almost half of all directors rate the Government’s performance in its first year in office as “poor” or “very poor”, according to the latest Director Sentiment Index (DSI). …
The Australian Institute of Company Directors’ DSI is the only indicator measuring the opinions and future intentions of directors. It is based on a survey of 501 directors of private business, not-for-profit organisations and ASX-listed companies. …
Almost half of all directors believe the Government’s performance had a negative impact on their business decision-making and around 75 per cent believe it had a negative impact on consumer confidence. This continues a downward trend in sentiment that has been apparent since the Coalition took power last September. …
Directors nominate multinational tax arrangements as the top priority in any comprehensive review of the tax system, followed by reforms to state levies such as payroll tax. GST reform ranks as the third most important priority.
… extreme disappointment with the government following the decision announced today to back date the removal of tax support provisions for small business that comes as a result of the removal of the mining tax.
… the change should not be back dated as this creates confusion for the small business community as well as extra paperwork for those who, in good faith, purchased goods and/or claimed these as part of their tax return.
And more recently the government announced with no warning it was funding its Orwellian titled “Plan for Australian Jobs” package by cutting the Research and Development tax break for large companies, reaping $1 billion over four years.
The government has become immensely unpredictable on tax policy despite the charade of consultation.
We will therefore use the opportunity of the scheduled 2014 changes to the R&D Tax Incentive programme to review access to R&D tax support for many businesses that have been barred from possible access under a series of retrograde cost savings made by Labor.
In short, as the Government prepares Australia and Australians to thrive in the "Asian Century", it appears counter-productive to be pulling back on incentivising R&D activities for our largest companies just when the Asian region appears to be heading in the opposite direction when it comes to R&D tax policy.
The Senate divided. [20:59]
(The President—Senator Parry)
(1) Schedule 1, page 3 (line 1) to page 4 (line 13), omit the Schedule, substitute:
Schedule 1—Quarterly R&D credits
Part 1—Main amendment
Taxation Administration Act 1953
1 After Part 2 ‑10 in Schedule 1
Insert:
Part 2 ‑15—Quarterly credits of refundable tax offsets
Division 48—Quarterly credits
Table of Subdivisions
Guide to Division 48
48‑A Object
48‑B Participating in the quarterly credits system
48‑C Tests for participation
48‑D Working out and paying quarterly credit amounts
48‑E End of year reconciliation
48‑F Ending participation
48‑P Special rules for consolidated groups etc.
48‑T Other matters
Guide to Division 48
48 ‑1 What this Division is about
You can apply to participate in the quarterly credits system for an income year if you expect to be entitled to refundable tax offsets for the income year that are covered by the system.
Participating gives you quarterly credits towards your likely refund from those tax offsets. These credits will either be based on your refund from a recent income year, or on a varied amount chosen by you after estimating your refund for the current year.
A reconciliation happens when the current year's assessment is made. General interest charge may be payable if you chose to base your credits on a varied amount and they are excessively high.
Subdivision 48 ‑A—Object
Table of sections
48‑3 Object
48 ‑3 Object
The object of this Division is to benefit the Australian economy by improving entities' cash flow by enabling them to realise the benefit of certain expected refundable tax offsets on a quarterly basis during the income year.
Subdivision 48 ‑B—Participating in the quarterly credits system
Table of sections
48‑5 Participating in the quarterly credits system
48‑10 Refusing participation
48‑15 Applying to participate
48 ‑5 Participating in the quarterly credits system
(1) The Commissioner may, on application, allow you to participate in the *quarterly credits system for:
(a) each of the *instalment quarters in an income year, other than any excluded under subsection (3); and
(b) one or more specified *tax offsets covered by section 48‑100.
Note: If you are dissatisfied with a decision under this subsection, you may object against it in the manner set out in Part IVC (see section 48‑800).
(2) The Commissioner must notify you in writing of:
(a) the Commissioner's decision under subsection (1); and
(b) the reasons for the decision, if the decision refuses to allow you to participate as set out in your application.
(3) An *instalment quarter is excluded if the Commissioner receives your application after:
(a) if all or a part of a December falls within the last month of the instalment quarter—the next 14 February after the end of the instalment quarter; or
(b) otherwise—the 14th day after the end of the instalment quarter.
48 ‑10 Refusing participation
(1) The Commissioner must, under subsection 48‑5(1), refuse to allow you to participate for:
(a) any of the *instalment quarters, and a specified *tax offset, if the Commissioner is aware that you fail a test in Subdivision 48‑C necessary for that participation; or
(b) a specified instalment quarter, and a specified tax offset, if during that instalment quarter you have already withdrawn under section 48‑400 from participating in the *quarterly credits system for that tax offset.
Note 1: The Commissioner may allow you to participate to the extent that paragraph (a) or (b) does not prevent this.
Note 2: This subsection applies separately for each tax offset mentioned in your application.
(2) The Commissioner may, under subsection 48‑5(1), refuse to allow you to participate for one or more specified *instalment quarters and *tax offsets if:
(a) you fail to give the Commissioner, in accordance with section 48‑15, information requested under that section; or
(b) for a tax offset listed in table item 20 (about R&D) in section 48‑100—at any time you failed to give *Innovation Australia, in accordance with section 28H of the Industry Research and Development Act 1986 , information requested under that section of that Act.
48 ‑15 Applying to participate
(1) An application to participate in the *quarterly credits system for one or more *instalment quarters in an income year, and one or more *tax offsets, must be given to the Commissioner in the *approved form before:
(a) if all or a part of a December falls within the last month of the income year—the next 15 February after the end of the income year; or
(b) otherwise—the 15th day after the end of the income year.
(2) The Commissioner may request you in writing to give specified information to the Commissioner about your application.
(3) The request may be for the information to be given to the Commissioner in the *approved form within:
(a) 14 days after the request was made; or
(b) a further period allowed by the Commissioner.
Note: A failure to give the information in accordance with this subsection may result in the Commissioner refusing to allow you to participate (see subsection 48‑10(2)).
Subdivision 48 ‑C—Tests for participation
Table of sections
48‑100 Tests for participation
48‑105 Reasonable receipt test
48‑110 Complying taxpayer test
48 ‑100 Tests for participation
To participate in the *quarterly credits system for one or more *instalment quarters in an income year and a *tax offset listed in the table, you must pass each of the following tests:
(a) the reasonable receipt test in section 48‑105;
(b) the complying taxpayer test in section 48‑110;
(c) any extra test listed in the table for the tax offset.
48 ‑105 Reasonable receipt test
It must be reasonable to expect that:
(a) you will become entitled to the *tax offset for the income year; and
(b) the tax offset will be subject to the refundable tax offset rules.
48 ‑110 Complying taxpayer test
(1) You pass the complying taxpayer test if:
(a) no part of any of your *tax‑related liabilities remains unpaid after the time by which that liability is due to be paid; and
(b) during the current income year, and the 5 most recent income years, you have not been convicted of an offence against:
(i) a *taxation law; or
(ii) a law relating to a taxation law; and
(c) you are complying with all of your obligations under taxation laws to provide documents or information to the Commissioner or another entity; and
(d) it is reasonable to expect that you will comply with your obligations under taxation laws in the future.
(2) However, if this table applies to you, the corresponding entities mentioned in the table (your managing entities ) must also satisfy the paragraphs in subsection (1).
Note: This subsection only applies to each of your managing entities when it is in that capacity (see section 960‑100 of the Income Tax Assessment Act 1997 ).
Subdivision 48 ‑D—Working out and paying quarterly credit amounts
Table of sections
48‑200 Quarterly credit amounts
48‑205 Standard amount
48‑210 Choosing a varied amount
48‑215 Disallowing proposed varied amounts
48‑220 Notifying the Commissioner of proposed varied amounts
48‑225 When quarterly credit amounts are payable to you
48‑230 When quarterly credit amounts are payable by you
48‑235 The amount's quarterly credit due day
48 ‑200 Quarterly credit amounts
If you are participating in the *quarterly credits system for an *instalment quarter in an income year (the present year ) and one or more *tax offsets (thepresent tax offsets ), yourquarterly credit amount for the instalment quarter and the present tax offsets is:
(a) any varied amount applying under section 48‑210 for the instalment quarter and the present tax offsets; or
(b) otherwise—the standard amount worked out under section 48‑205.
Note: If you recommence participating in the quarterly credits system, paragraph (a) covers any varied amount applying for the instalment quarter under your earlier participation in the system.
48 ‑205 Standard amount
(1) If:
(a) for the most recent income year (the reference year ) for which the Commissioner has made an assessment of your income tax, you were entitled to *tax offsets of the same kinds as each of the present tax offsets; and
(b) those reference year tax offsets were subject to the refundable tax offset rules; and
(c) the reference year is one of the last 2 income years immediately before the present year;
the standard amount worked out under this section is 1/4 of the lesser of:
(d) the total amount of those reference year tax offsets; and
(e) the total of your *tax offset refunds (for tax offsets of any kind) for the reference year.
Note: If the instalment quarter is the first in the present year, the reference year will usually be a different year to that for later instalment quarters.
(2) Otherwise, the standard amount worked out under this section is nil.
48 ‑210 Choosing a varied amount
(1) You can choose to notify the Commissioner under section 48‑220 of a proposed varied amount for the *instalment quarter and the present tax offsets.
Note: If you do, your notice must include a proposed varied amount for each later instalment quarter in the income year (see paragraph 48‑215(1)(a)). A later notice can propose a replacement varied amount for those later instalment quarters.
(2) An amount you so notify for an *instalment quarter is the varied amount applying under this section for that instalment quarter and the present tax offsets if that amount is the most recent that:
(a) has been so notified for that instalment quarter; and
(b) has not been disallowed by the Commissioner.
That amount may be a nil or negative amount.
(3) The Commissioner may disallow a proposed varied amount.
Note: If you are dissatisfied with a decision under this subsection, you may object against it in the manner set out in Part IVC (see section 48‑800).
(4) The Commissioner must notify you in writing of:
(a) a decision under subsection (3) to disallow a proposed varied amount; and
(b) the reasons for the decision.
48 ‑215 Disallowing proposed varied amounts
(1) The Commissioner must, under subsection 48‑210(3), disallow each proposed varied amount included in your notice given under section 48‑220 if:
(a) that notice does not include a proposed varied amount for each of the following *instalment quarters in the present year for which you are participating in the *quarterly credits system:
(i) an instalment quarter that is yet to end when you gave that notice;
(ii) an instalment quarter for which the last month included all or a part of a December, if you gave that notice before the next 15 February;
(iii) an instalment quarter that ended less than 15 days before you gave that notice; or
(b) for any of the proposed varied amounts included in that notice (the test amount ), the sum of:
(i) the test amount; and
(ii) any of the other proposed varied amounts that are for earlier instalment quarters in the present year; and
(iii) your *quarterly credit amounts payable for any earlier instalment quarters in the present year;
is less than nil or exceeds the amount worked out under subsection (2).
(2) Work out the amount from the following formula:
where:
estimated end of year amount means the lesser of:
(a) the likely total of the present tax offsets and any other *tax offsets for which you are participating in the *quarterly credits system for an earlier *instalment quarter in the present year; and
(b) the likely total of your *tax offset refunds (for tax offsets of any kind) for the present year.
number of instalment quarters so far means the number of *instalment quarters in the income year, up to (and including) the instalment quarter for which the test amount is proposed, for which you are participating in the *quarterly credits system.
(3) The Commissioner may, under subsection 48‑210(3), disallow each proposed varied amount included in your notice under section 48‑220 if you fail to give the Commissioner, in accordance with that section, information requested under that section.
(4) The Commissioner must not, under subsection 48‑210(3), disallow the proposed varied amounts included in your notice under section 48‑220 if:
(a) none of the following provisions applies:
(i) paragraph (1)(a) or subsection (3);
(ii) paragraph (1)(b), if the sum in that paragraph is less than nil; and
(b) each of those proposed varied amounts is less than or equal to the amount that would otherwise be your *quarterly credit amount for the relevant *instalment quarter and the present tax offsets.
48 ‑220 Notifying the Commissioner of proposed varied amounts
(1) A notice of one or more proposed varied amounts must be given to the Commissioner in the *approved form before:
(a) if all or a part of a December falls within the last month of the earliest of the *instalment quarters to which the amounts relate—the next 15 February after the end of that instalment quarter; or
(b) otherwise—the 15th day after the end of the earliest of the instalment quarters to which the amounts relate.
Note: You must keep records in relation to the varied amount (see section 262A of the Income Tax Assessment Act 1936 ).
(2) The Commissioner may request you in writing to give specified information to the Commissioner about the notice.
(3) The request may be for the information to be given to the Commissioner in the *approved form within:
(a) 14 days after the request was made; or
(b) a further period allowed by the Commissioner.
Note: A failure by you to give the information in accordance with this subsection may result in the Commissioner refusing to allow the proposed varied amounts (see subsection 48‑215(3)).
48 ‑225 When quarterly credit amounts are payable to you
General rule
(1) The Commissioner must, on behalf of the Commonwealth, pay you your *quarterly credit amount for an *instalment quarter and the present tax offsets on or before this day:
(a) the 28th day of the calendar month after the end of the instalment quarter; or
(b) if all or a part of a December falls within the last month of the instalment quarter—the next 28 February.
Delayed payment—varied amount under examination
(2) Despite subsection (1), if:
(a) your *quarterly credit amount is a varied amount applying under section 48‑210 that exceeds the amount otherwise payable to you; and
(b) the Commissioner is examining whether to disallow that varied amount;
the Commissioner may, until the examination ends, delay paying you so much of that varied amount as is equal to the excess.
Note 1: If you are dissatisfied with a decision under this subsection to delay payment of the excess, you may object against it in the manner set out in Part IVC (see section 48‑800).
Note 2: Interest accrues under Part IIIAB of the Taxation (Interest on Overpayments and Early Payments) Act 1983 while the Commissioner delays payment of the excess.
Note 3: The excess (and the interest) is not payable if the examination results in the varied amount being disallowed.
Delayed payment—participation under examination
(3) Despite subsection (1), the Commissioner may delay paying you your *quarterly credit amount if and while:
(a) the Commissioner is examining whether your participation should be revoked; or
(b) the Commissioner is aware that a regulator mentioned in the table is examining a matter relevant to whether your participation should be revoked.
Note 1: If you are dissatisfied with a decision under this subsection to delay your payment, you may object against it in the manner set out in Part IVC (see section 48‑800).
Note 2: Interest accrues under Part IIIAB of the Taxation (Interest on Overpayments and Early Payments) Act 1983 while the Commissioner delays your payment.
Note 3: Your payment (and the interest) is not payable if the examination results in your participation being revoked.
Delayed payment—you cannot receive electronic payments etc.
(4) Despite subsection (1), the Commissioner must delay paying you your *quarterly credit amount if and while the Commissioner is aware that your circumstances do not enable payments to be made to you in accordance with subsection 48‑820(1) (about electronic payments etc.).
Note: Interest accrues under Part IIIAB of the Taxation (Interest on Overpayments and Early Payments) Act 1983 if the Commissioner delays your payment more than 14 days after becoming aware that electronic payments can now be made to you.
Matters relevant to delayed payments
(5) The Commissioner must notify you in writing of:
(a) a decision under subsection (2), (3) or (4) to delay your payment; and
(b) the reasons for the decision.
Payments cannot be made on or after assessment
(6) Despite subsection (1), your *quarterly credit amount for an *instalment quarter and the present tax offsets must not be paid to you on or after the assessment day (see paragraph 48‑300(1)(b)) for the present year.
48 ‑230 When quarterly credit amounts are payable by you
(1) However, if your *quarterly credit amount for the *instalment quarter and the present tax offsets is a negative amount, you are liable to pay the Commonwealth that amount (expressed as a positive amount).
Note: The amount will only be a negative amount if you choose a varied amount that is a negative amount.
(2) That amount is due and payable on the *quarterly credit amount's *quarterly credit due day.
Note: For provisions about collection and recovery of the amount, see Part 4‑15.
(3) If any of that amount (the varied amount ) remains unpaid after the *quarterly credit amount's *quarterly credit due day, you are liable to pay the *general interest charge on the unpaid amount for each day in the period that:
(a) starts on the day after that due day; and
(b) ends on the last day any of the following remains unpaid:
(i) the varied amount;
(ii) general interest charge on any of the varied amount.
(4) This section does not apply if the *quarterly credit amount's *quarterly credit due day is on or after the assessment day (see paragraph 48‑300(1)(b)) for the present year.
48 ‑235 The amount ' s quarterly credit due day
The quarterly credit due day for a *quarterly credit amount is:
(a) if that amount is a positive amount—the day referred to in subsection 48‑225(1); or
(b) if that amount is a nil or negative amount—the day that would have been the day referred to in subsection 48‑225(1) were that amount a positive amount.
Subdivision 48 ‑E—End of year reconciliation
Table of sections
48‑300 Debit equal to the total quarterly credits paid
48‑305 When the debit is due
48‑350 Liability to GIC on excess quarterly credits worked out using varied amounts
48‑355 Benchmark amount for the variation quarter
48 ‑300 Debit equal to the total quarterly credits paid
(1) You are liable to pay the Commonwealth an amount (a debit ) under this section if:
(a) you are participating in the *quarterly credits system for one or more *instalment quarters in an income year and one or more *tax offsets; and
(b) on a particular day (the assessment day ), the Commissioner makes an assessment:
(i) of the total of your *tax offset refunds for the income year; or
(ii) that you can get no such refunds for the income year.
Note: The debit will be offset by a credit equal to the total of your tax offset refunds.
(2) The debit is equal to the sum of your *quarterly credit amounts for those *instalment quarters and those *tax offsets, disregarding so much of any of those amounts as:
(a) is a positive amount not paid before the assessment day; or
(b) is a negative amount with a *quarterly credit due day that is on or after the assessment day.
Note: This debit only includes your quarterly credit amounts for those instalment quarters for which you are participating in the quarterly credits system. It does not include quarterly credit amounts for instalment quarters for which you (under Subdivision 48‑F) have ceased to participate.
(3) The Commissioner must give you notice of the debit, unless subsection 166A(3) of the Income Tax Assessment Act 1936 applies to you for the income year.
Note 1: This could be done by including the debit in the notice of your assessment referred to in paragraph (1)(b).
Note 2: The debit is the debit as amended. So, if a previously notified debit is incorrect, notice of the debit (as amended) must also be given for this subsection to be satisfied.
48 ‑305 When the debit is due
(1) Parts of the debit may be due on different days.
(2) So much of the debit as does not exceed the total of your *tax offset refunds for the income year is due and payable on the assessment day.
Note: This part of the debit will be offset by the credit equal to the total of your tax offset refunds.
(3) So much of the debit (if any) as exceeds the total of your *tax offset refunds for the income year is due and payable on the day your income tax for the income year:
(a) is due and payable; or
(b) would have been due and payable if you were liable to pay income tax for the income year.
Note 1: For the day income tax is due, see section 5‑5 of the Income Tax Assessment Act 1997 .
Note 2: For provisions about collection and recovery of this excess, see Part 4‑15.
(4) If so much of the debit as is covered by subsection (3) (the excess ) remains unpaid after the time by which it is due to be paid, you are liable to pay the *general interest charge on the unpaid amount for each day in the period that:
(a) starts on the day after the excess was due to be paid; and
(b) ends on the last day any of the following remains unpaid:
(i) the excess;
(ii) general interest charge on any of the excess.
48 ‑350 Liability to GIC on excess quarterly credits worked out using varied amounts
(1) You are liable to pay the *general interest charge under this section if:
(a) you are participating in the *quarterly credits system for an *instalment quarter (the variation quarter ) in an income year and one or more *tax offsets; and
(b) this is the case:
Benchmark amount ˂ 85% of your total credits
where:
benchmark amount means the amount worked out under section 48‑355 for the variation quarter and those tax offsets.
your total credits means the sum of your *quarterly credit amounts for the variation quarter and any earlier instalment quarters in the income year, disregarding so much of any of those amounts as:
(i) is a positive amount not paid before the assessment day (see paragraph 48‑300(1)(b)) for the income year; or
(ii) is a negative amount with a *quarterly credit due day that is on or after that assessment day.
Note: You will not be liable for this charge if your quarterly credit amounts have never been varied above the standard amounts, as your total credits will never exceed the benchmark amount (see section 48‑355).
(2) You are liable to pay the *general interest charge on the difference between your total credits and the benchmark amount.
(3) You are liable to pay the charge for each day in the period:
(a) starting on the *quarterly credit due day for your *quarterly credit amount for the variation quarter; and
(b) ending on the earlier of:
(i) if you have a quarterly credit amount for one or more later *instalment quarters in the income year—the quarterly credit due day for the first of those later quarterly credit amounts; and
(ii) the assessment day (see paragraph 48‑300(1)(b)) for the income year.
Note: Subparagraph (b)(i) includes the case where you have a nil or negative quarterly credit amount for a later instalment quarter.
(4) The Commissioner must give you written notice of the *general interest charge to which you are liable under subsection (2). You must pay the charge within 14 days after you are given that notice.
Note: The Commissioner may remit the charge (see section 8AAG).
(5) If any of the *general interest charge to which you are liable under subsection (2) (the original GIC ) remains unpaid at the end of the 14 days referred to in subsection (4), you are also liable to pay the general interest charge on the unpaid amount for each day in the period that:
(a) starts on the day after those 14 days; and
(b) ends on the last day any of the following remains unpaid:
(i) the original GIC;
(ii) general interest charge on any of the original GIC.
48 ‑355 Benchmark amount for the variation quarter
(1) The amount worked out under this section for the variation quarter and those *tax offsets is the greater of:
(a) the sum of the standard amounts worked out under section 48‑205 for:
(i) the variation quarter; and
(ii) any earlier *instalment quarters in the income year for which you are participating in the *quarterly credits system; and
(b) the amount applying under subsection (2).
(2) The amount applying under this subsection is as follows:
where:
end of year amount means the lesser of:
(a) either:
(i) the total amount of those *tax offsets and any other tax offsets for which you are participating in the *quarterly credits system for an earlier *instalment quarter in the income year; or
(ii) nil, if you are not entitled to any of the tax offsets referred to in subparagraph (i) for the income year; and
(b) the total of your *tax offset refunds (for tax offsets of any kind) for the income year.
number of instalment quarters so far means the number of *instalment quarters in the income year, up to (and including) the variation quarter, for which you are participating in the *quarterly credits system.
Subdivision 48 ‑F—Ending participation
Table of sections
48‑400 Withdrawing participation
48‑405 You must withdraw if you later fail a test etc.
48‑410 Excusing noncompliance after you start participating
48‑415 Applying for noncompliance to be excused
48‑420 Revoking participation
48‑425 Collecting and recovering quarterly credits paid to you for quarters for which you no longer participate
48‑430 Recovering quarterly credits paid by you for quarters for which you no longer participate
48 ‑400 Withdrawing participation
(1) You may withdraw from participating in the *quarterly credits system for any or all of the *instalment quarters (whether past, current or future) in the income year and one or more *tax offsets.
Note: You will need to repay any quarterly credit amounts paid to you for instalment quarters that you later withdraw from (see section 48‑425).
(2) A withdrawal must be by notice given to the Commissioner in the *approved form.
(3) The withdrawal takes effect, for the *instalment quarters and *tax offsets specified in it, when it is given to the Commissioner.
Note: You may apply to participate again in the quarterly credits system for later instalment quarters in the income year.
(4) A withdrawal is irrevocable.
48 ‑405 You must withdraw if you later fail a test etc.
Failing a test necessary for participation
(1) You contravene this subsection if:
(a) you are participating in the *quarterly credits system for an *instalment quarter in an income year and a *tax offset; and
(b) during the instalment quarter, you (or any of your *managing entities) fail a test in Subdivision 48‑C necessary for that participation, other than paragraph 48‑110(1)(a) or (c); and
(c) that participation is not revoked under section 48‑420; and
(d) you do not, within 28 days after that failure happened or started, withdraw from participating in the quarterly credits system for the instalment quarter and the tax offset in accordance with section 48‑400.
Note 1: This subsection applies separately for each instalment quarter and tax offset for which you are participating in the quarterly credits system.
Note 2: Your managing entities may contravene this subsection if you are a partnership, trust or unincorporated association or body (see Division 444).
Failing to comply with a taxation obligation
(2) You contravene this subsection if:
(a) you are participating in the *quarterly credits system for an *instalment quarter in an income year and a *tax offset; and
(b) during the instalment quarter, you (or any of your *managing entities) fail to comply with an obligation under a *taxation law (whether the obligation arises before, at or after the start of the instalment quarter); and
(c) that participation is not revoked under section 48‑420; and
(d) none of the following happen within 28 days after that failure happened or started:
(i) that failure is excused under subsection 48‑410(2);
(ii) you apply for that failure to be excused under subsection 48‑410(2);
(iii) you withdraw from participating in the quarterly credits system for the instalment quarter and the tax offset in accordance with section 48‑400.
Note 1: This subsection applies separately for each instalment quarter and tax offset for which you are participating in the quarterly credits system.
Note 2: Your managing entities may contravene this subsection if you are a partnership, trust or unincorporated association or body (see Division 444).
Strict liability offence
(3) You commit an offence of strict liability if you contravene subsection (1) or (2).
Penalty: 60 penalty units.
Note 1: For strict liability, see section 6.1 of the Criminal Code .
Note 2: Section 4K of the Crimes Act 1914 applies to an offence against this subsection, so you commit an offence for each day after that 28 day period that you do not withdraw from the quarterly credits system.
Administrative penalty
(4) You are liable to pay to the Commissioner a penalty of 20 penalty units if you contravene subsection (1) or (2).
Note 1: Division 298 in this Schedule contains machinery provisions for administrative penalties.
Note 2: This administrative penalty is not payable if you are prosecuted under subsection (3) for the same contravention (see section 8ZE).
48 ‑410 Excusing noncompliance after you start participating
(1) This section applies if:
(a) you are participating in the *quarterly credits system for one or more *instalment quarters in an income year and a *tax offset; and
(b) after you start participating, you (or any of your *managing entities) fail to comply with an obligation under a *taxation law (whether the obligation arises before, at or after the time you start participating).
Note: This subsection applies separately for each tax offset for which you are participating in the quarterly credits system for those instalment quarters.
(2) For the purposes of this Division, the Commissioner may excuse that failure.
Note: If you are dissatisfied with a decision under this subsection, you may object against it in the manner set out in Part IVC (see section 48‑800).
(3) In deciding whether to excuse that failure, the Commissioner must have regard to:
(a) the consequences of that failure; and
(b) the consequences of any other failure for which this section applies in relation to that participation; and
(c) the likelihood of you (and your *managing entities (if any)) complying in the future with obligations under taxation laws; and
(d) the likely consequences if you (or any of those managing entities) do not so comply.
(4) That failure may be excused, under subsection (2), on the Commissioner's own initiative or on application.
(5) The Commissioner may, under subsection (2), refuse to excuse that failure if you fail to give the Commissioner, in accordance with section 48‑415, information requested under that section.
(6) The Commissioner must notify you in writing of:
(a) the Commissioner's decision under subsection (2); and
(b) if the decision refuses to excuse that failure—the reasons for the decision.
48 ‑415 Applying for noncompliance to be excused
(1) An application for the Commissioner to excuse a failure must be given to the Commissioner in the *approved form within:
(a) 28 days after the day that failure happened or started; or
(b) a further period allowed by the Commissioner.
(2) The Commissioner may request you in writing to give specified information to the Commissioner about your application.
(3) The request may be for the information to be given to the Commissioner in the *approved form within:
(a) 14 days after the request was made; or
(b) a further period allowed by the Commissioner.
Note: A failure to give the information in accordance with this subsection may result in the Commissioner refusing to excuse that failure (see subsection 48‑410(5)).
48 ‑420 Revoking participation
Mandatory revocation if fail a test when start participating
(1) The Commissioner must, by notice in writing given to you, revoke your participation in the *quarterly credits system for:
(a) all of the *instalment quarters (whether past, current or future) in an income year; and
(b) one or more *tax offsets;
if the Commissioner is aware that, when you started participating, you (or any of your *managing entities) failed a test in Subdivision 48‑C necessary for that participation.
Note: If you are dissatisfied with a decision under this subsection, you may object against it in the manner set out in Part IVC (see section 48‑800).
Revocation if default event happens
(2) The Commissioner may, by notice in writing given to you, revoke your participation in the *quarterly credits system for any or all of the *instalment quarters (whether past, current or future) in an income year and one or more *tax offsets if:
(a) at any time during the income year after you start participating, you (or any of your *managing entities) fail a test in Subdivision 48‑C necessary for that participation, other than paragraph 48‑110(1)(a) or (c); or
(b) at any time during the income year after you start participating:
(i) you (or any of your managing entities) fail to comply with an obligation under a *taxation law (whether the obligation arises before, at or after the time you start participating); and
(ii) the failure has not been excused under subsection 48‑410(2); or
(c) you do not lodge your *income tax return for the income year with the Commissioner on or before the required day.
Note: If you are dissatisfied with a decision under this subsection, you may object against it in the manner set out in Part IVC (see section 48‑800).
Matters relevant to revocations
(3) A revocation takes effect for:
(a) the *tax offsets specified in the notice; and
(b) for a revocation under subsection (2)—the *instalment quarters specified in the notice.
(4) A notice under subsection (1) or (2) must include the reasons for the revocation.
48 ‑425 Collecting and recovering quarterly credits paid to you for quarters for which you no longer participate
(1) If:
(a) on a particular day (the payment day ), you are paid all or part of a *quarterly credit amount for an *instalment quarter in an income year and one or more *tax offsets; and
(b) under this Subdivision, you cease to participate in the *quarterly credits system for that instalment quarter and one or more of those tax offsets;
you are liable to repay the Commonwealth so much of that amount as you were paid (the repayable amount ).
(2) The repayable amount is due and payable on the payment day.
Note: For provisions about collection and recovery of that amount, see Part 4‑15.
(3) If any of the repayable amount remains unpaid after the payment day, you are liable to pay the *general interest charge on the unpaid amount for each day in the period that:
(a) starts on the day after the payment day; and
(b) ends on the last day any of the following remains unpaid:
(i) the repayable amount;
(ii) general interest charge on any of the repayable amount.
48 ‑430 Recovering quarterly credits paid by you for quarters for which you no longer participate
(1) If:
(a) on a particular day (the payment day ), you pay an amount under section 48‑230 for an *instalment quarter in an income year and one or more *tax offsets; and
(b) under this Subdivision, you cease to participate in the *quarterly credits system for that instalment quarter and those tax offsets;
the Commissioner must, on behalf of the Commonwealth, repay that amount to you on or before the 14th day after the day the notice is given that causes that cessation.
Note: See Division 3A of Part IIB for the rules about how the Commissioner must pay that amount. Division 3 of Part IIB allows the Commissioner to apply that amount as a credit against tax debts that you owe to the Commonwealth.
(2) However, the Commissioner must delay repaying you that amount if and while the Commissioner is aware that your circumstances do not enable payments to be made to you in accordance with subsection 48‑820(1) (about electronic payments etc.).
Note: Interest accrues under Part IIIAB of the Taxation (Interest on Overpayments and Early Payments) Act 1983 if the Commissioner delays the repayment more than 14 days after becoming aware that electronic payments can now be made to you.
Subdivision 48 ‑P—Special rules for consolidated groups etc.
Table of sections
48‑700 Single entity rule
48‑705 Entry rule
48‑710 Exit rule
48‑715 Effect of choice to continue group after shelf company becomes new head company
48‑720 Effect of change of provisional head company of a MEC group
48‑725 Conversions—MEC group to consolidated group
48‑730 Conversions—consolidated group to MEC group
48‑735 Giving notice if new group comes into existence
48 ‑700 Single entity rule
For each *instalment quarter starting during the period an entity is a *subsidiary member of a *consolidated group or *MEC group:
(a) that entity; and
(b) any other subsidiary member of the group;
are taken for the purposes of this Division to be parts of the *head company or *provisional head company of the group (rather than separate entities).
Note 1: The entity will continue to have any quarterly credit amount payable for the instalment quarter in which it joins the group. However, the group will continue to have any quarterly credit amount payable for the instalment quarter in which the entity leaves the group.
Note 2: Each entity that continues to have that quarterly credit amount will also have an end‑of‑year debit under section 48‑300 that takes account of that amount.
Note 3: Despite this single entity rule, a subsidiary member of the group is jointly and severally liable for a liability under this Division of the head company (see section 721‑10 of the Income Tax Assessment Act 1997 ).
48 ‑705 Entry rule
(1) This section applies if an entity becomes a *subsidiary member of a *consolidated group or *MEC group during an *instalment quarter in an income year.
(2) Except as set out in the table, for the purposes of this Division and future *instalment quarters, everything that happened in relation to the entity before those future instalment quarters is taken to have happened instead in relation to the *head company or *provisional head company of the group.
Note: Table item 1 does not prevent the entity's personnel, past practices and culture etc. from being relevant for working out, during future instalment quarters, whether the head company or provisional head company satisfies paragraph 48‑110(1)(d) (about complying with future tax obligations).
48 ‑710 Exit rule
(1) This section applies if an entity ceases to be a *subsidiary member of a *consolidated group or *MEC group during an *instalment quarter in an income year.
(2) Except as set out in the table, for the purposes of this Division and future *instalment quarters, nothing that happened in relation to the *head company or *provisional head company of the group before those future instalment quarters, whether:
(a) while the entity was a *subsidiary member of the group; or
(b) because of the application of section 48‑705 (about transferring the entity's earlier history to the group);is taken to have happened in relation to the entity.
(3) For the *head company or *provisional head company:
(a) any varied amount applying under section 48‑210 at the start of the next *instalment quarter (if any) in the income year; and
(b) the standard amount worked out under section 48‑205;
are taken to be nil for that next instalment quarter and any later instalment quarters in the income year.
Note: The head company or provisional head company may, after the start of that next quarter, choose to notify the Commissioner of further proposed varied amounts for that quarter and later quarters.
48 ‑715 Effect of choice to continue group after shelf company becomes new head company
(1) This section applies if:
(a) immediately before a particular time (the completion time ), a company (theoriginal company ) is the *head company of a *consolidated group; and
(b) another company (the interposed company ) chooses under subsection 124‑380(5) of theIncome Tax Assessment Act 1997 that the group is to continue in existence at and after the completion time.
(2) For the purposes of this Division:
(a) the group is taken not to have ceased to exist under subsection 703‑5(2) of that Act because the original company ceases to be the *head company of the group; and
(b) the interposed company is taken to have become the head company of the group at the completion time; and
(c) the original company is taken to have ceased to be the head company at that time.
(3) For the purposes of this Division at and after the completion time, everything that happened in relation to the original company before the completion time:
(a) is taken to have happened in relation to the interposed company instead of in relation to the original company; and
(b) is taken to have happened in relation to the interposed company instead of what would (apart from this section) be taken to have happened in relation to the interposed company before that time;
just as if, at all times before the completion time, the interposed company had been the original company and the original company had been the interposed company.
Note: The original company and the interposed company have in effect exchanged identities throughout the period before the completion time for the purposes of the quarterly credits system.
Example: The original company is participating in the quarterly credits system for all 4 instalment quarters in an income year, but then the completion time happens during the third quarter. The interposed company will be paid the quarterly credit amounts for the third and fourth quarters, and will have a debit under section 48‑300 for the amounts paid for all 4 quarters.
(4) However, while subsection (3) applies to a negative *quarterly credit amount having a *quarterly credit due day that is before the completion time, that subsection does not apply to:
(a) the original company's liability to pay that amount; or
(b) any other *tax‑related liability arising from this Division before the completion time.
Example: In the example from subsection (3), if the quarterly credit amount for the second quarter was a negative amount:
(a) after the completion time, the original company will continue to be liable under section 48‑230 to pay that amount; and
(b) the interposed company's end‑of‑year debit under section 48‑300 will take account of that amount.
48 ‑720 Effect of change of provisional head company of a MEC group
(1) This section applies if:
(a) a company (the old head company ) is the *provisional head company of a *MEC group just before a *cessation event happens to the company; and
(b) a different company (the new head company ) is the provisional head company of the group at the time (thetransition time ) just after that cessation event.
(2) For the purposes of this Division at and after the transition time, everything that happened in relation to the old head company before the transition time:
(a) is taken to have happened in relation to the new head company instead of in relation to the old head company; and
(b) is taken to have happened in relation to the new head company instead of what would (apart from this section) be taken to have happened in relation to the new head company before that time;
just as if, at all times before the transition time, the new head company had been the old head company and the old head company had been the new head company.
Note: The new head company and old head company have in effect exchanged identities throughout the period before the transition time for the purposes of the quarterly credits system.
(3) However, while subsection (2) applies to a negative *quarterly credit amount having a *quarterly credit due day that is before the transition time, that subsection does not apply to:
(a) the old head company's liability to pay that amount; or
(b) any other *tax‑related liability arising from this Division before the transition time.
Note: The examples to subsections 48‑715(3) and (4) apply in a similar way to subsections (2) and (3) of this section.
48 ‑725 Conversions—MEC group to consolidated group
(1) This section applies if, at a particular time (the conversion time ), a *consolidated group (thenew group ) is *created from a *MEC group (theold group ).
(2) For the purposes of this Division at and after the conversion time:
(a) the new group is taken to be a continuation of the old group; and
(b) everything that happened in relation to the *provisional head company of the old group before the conversion time is taken instead to have happened in relation to that entity in its role as *head company of the new group.
48 ‑730 Conversions—consolidated group to MEC group
(1) This section applies if, at a particular time (the conversion time ), a MEC group (thenew group ) is created from a consolidated group (theold group ).
(2) For the purposes of this Division at and after the conversion time:
(a) the new group is taken to be a continuation of the old group; and
(b) everything that happened in relation to the *head company of the old group before the conversion time is taken instead to have happened in relation to that entity in its role as *provisional head company of the new group.
48 ‑735 Giving notice if new group comes into existence
(1) The *head company of a *consolidated group, or *provisional head company of a *MEC group, must notify the Commissioner if:
(a) the group comes into existence on a particular day in an income year; and
(b) just before that day, an entity that has become a *subsidiary member of the group was participating in the *quarterly credits system for one or more *instalment quarters in the income year.
Note: The Commissioner must also be notified of other situations where the entity joins or leaves a group (see sections 703‑60 and 719‑80 of the Income Tax Assessment Act 1997 ).
(2) The notice must be given to the Commissioner in the *approved form within 28 days after the day the group comes into existence.
(3) This section does not limit section 703‑58 or 719‑76 (about giving notice of a new group) of the Income Tax Assessment Act 1997 .
Subdivision 48 ‑T—Other matters
Table of sections
48‑800 Objecting to decisions
48‑820 How amounts are to be paid
48‑840 Alternative constitutional basis
48 ‑800 Objecting to decisions
A person who is dissatisfied with a decision of the Commissioner under any of the following provisions may object against it in the manner set out in Part IVC:
(a) subsection 48‑5(1);
(b) subsection 48‑210(3);
(c) subsection 48‑225(2);
(d) subsection 48‑225(3);
(e) subsection 48‑410(2);
(f) subsection 48‑420(1);
(g) subsection 48‑420(2).
48 ‑820 How amounts are to be paid
(1) Payments under this Division to or by you must be by:
(a) a means of *electronic payment; or
(b) a method applying to you under subsection (2).
Note: You are liable to an administrative penalty if you fail to comply with paragraph (a) or (b) when making payments under this Division (see section 288‑20).
(2) The Commissioner may, in writing, approve a method by which payments under this Division to or by an entity may be made.
Note: Different methods can be approved for different classes of entities, see subsection 33(3AB) of the Acts Interpretation Act 1901 .
(3) An approval may be expressed to apply from a day before the approval is made.
48 ‑840 Alternative constitutional basis
(1) Without limiting its effect apart from this subsection, this Division has the effect it would have if:
(a) subsection (2) had not been enacted; and
(b) a *quarterly credit amount could only be worked out for an entity that:
(i) is a *constitutional corporation; or
(ii) has its registered office (within the meaning of the Corporations Act 2001 ) or principal place of business (within the meaning of that Act) located in a Territory.
(2) Without limiting its effect apart from this subsection, this Division has the effect it would have if:
(a) subsection (1) had not been enacted; and
(b) *quarterly credit amounts could only be worked out in respect of activities, or parts of activities, conducted or to be conducted:
(i) solely in a Territory; or
(ii) solely outside of Australia; or
(iii) solely in a Territory and outside of Australia; or
(iv) for the dominant purpose of supporting *core R&D activities conducted, or to be conducted, solely in a Territory.
Part 2—Innovation Australia ' s role
Industry Research and De velopment Act 1986
2 Section 26A
Omit "The R&D entity can seek an advance finding to get", substitute "The Board may make an advance finding to give".
3 Section 26A
Omit "The R&D entity can seek a", substitute "The Board may make a".
4 Paragraph 27L(2)(a)
Repeal the paragraph, substitute:
(a) a finding in force under subsection 28A(1) (advance findings about activities) is about an activity conducted during an income year and is related to an R&D entity; and
5 Section 28
Omit "An R&D entity can seek" (wherever occurring), substitute "The Board may make".
6 Section 28A
Repeal the section, substitute:
28A Ad vance findings about the nature of activities
(1) The Board may make one or more findings to the following effect about an activity that is related to an R&D entity:
(a) that all or part of the activity is a core R&D activity;
(b) that all or part of the activity is a supporting R&D activity in relation to one or more specified core R&D activities for which the entity has been or could be registered under section 27A for an income year;
(c) that all or part of the activity is neither:
(i) a core R&D activity; nor
(ii) a supporting R&D activity of a kind covered by paragraph (b).
Note 1: A finding is reviewable (see Division 5).
Note 2: A finding binds the Commissioner for the purposes of income tax assessments and the provision of quarterly credits (see subsections 355‑705(2) and (3) of the Income Tax Assessment Act 1997 ).
(2) The Board must not make a finding under subsection (1) about an activity unless the Board is satisfied that the activity:
(a) is being conducted, or has been completed, during the income year applying under subsection (3); or
(b) is yet to be conducted, but that it is reasonable to expect that the activity will be conducted in any or all of the following income years:
(i) the income year applying under subsection (3);
(ii) either of the next 2 income years.
(3) The income year applying under this subsection is either:
(a) the income year in which the process of considering whether to make the finding starts; or
(b) the previous income year, if this is preferred by the entity causing this process to start, and clearly stated as such:
(i) in any application or request (see subsection 28AA(1)) causing this process to start; or
(ii) in the Board's reasons for making, or not making, the finding, if the Board causes this process to start on its own initiative.
However, paragraph (b) does not apply if this process starts after the R&D entity has applied to register activities under section 27A for that previous income year.
Note: The process of considering whether to make the finding starts when the application or request is made, or when the Board starts considering whether to make the finding on its own initiative.
(4) If the Board makes a finding under subsection (1) about an activity that is being conducted, or has been completed, during the income year applying under subsection (3), the Board may specify in the finding the times to which the finding relates.
(5) This section has effect subject to section 32B (findings cannot be inconsistent with any earlier findings).
7 After section 28A
Insert:
28AA Causing advance findings to be made
(1) If:
(a) an R&D entity applies for one or more findings under subsection 28A(1) about an activity; or
(b) the Commissioner:
(i) requests one or more findings under subsection 28A(1) about an activity that is related to an R&D entity; and
(ii) does not later withdraw the request;
the Board must:
(c) make one or more findings under that subsection about all or part of the activity; or
(d) if justified in accordance with the decision‑making principles—refuse to make a finding under that subsection about all or part of the activity.
Note 1: For requirements of applications by R&D entities, see section 28G.
Note 2: Refusing to make a finding is reviewable (see Division 5).
Note 3: Section 32A deals with the decision‑making principles.
(2) The Board may also make a finding under subsection 28A(1) on its own initiative in accordance with any applicable decision‑making principles.
Note: Section 32A deals with the decision‑making principles.
8 Subsection 28C(1)
Repeal the subsection, substitute:
(1) The Board may make one or more findings to the following effect about an activity that is related to an R&D entity:
(a) that all or part of the activity is an activity (the overseas activity ) that meets the conditions in section 28D;
(b) that all or part of the activity is not an activity that meets the conditions in section 28D.
Note 1: A finding is reviewable (see Division 5).
Note 2: An effect of a finding under paragraph (a) is that a tax offset may be available for expenditure incurred on the overseas activity after the finding comes into force (see Division 355 of the Income Tax Assessment Act 1997 , in particular paragraphs 355‑210(1)(d) and (e) of that Act).
9 At the end of Subdivision C of Division 3 of Part III
Add:
28DA Causing overseas activity findings to be made
(1) If:
(a) an R&D entity applies for one or more findings under subsection 28C(1) about an activity; or
(b) the Commissioner:
(i) requests one or more findings under subsection 28C(1) about an activity that is related to an R&D entity; and
(ii) does not later withdraw the request;
the Board must:
(c) make one or more findings under that subsection about all or part of the activity; or
(d) if justified in accordance with the decision‑making principles—refuse to make a finding under that subsection about all or part of the activity.
Note 1: For requirements of applications by R&D entities, see section 28G.
Note 2: Refusing to make a finding is reviewable (see Division 5).
Note 3: Section 32A deals with the decision‑making principles.
(2) The Board may also make a finding under subsection 28C(1) on its own initiative in accordance with any applicable decision‑making principles.
Note: Section 32A deals with the decision‑making principles.
10 Subsection 28E(1)
Repeal the subsection, substitute:
(1) If an R&D entity has acquired, or has acquired the right to use, particular technology wholly or partly for the purposes of one or more R&D activities conducted, or to be conducted, during one or more income years, the Board may make a finding to the effect:
(a) that the technology is core technology for the R&D activities; or
(b) that the technology is not core technology for the R&D activities.
Note 1: A finding is reviewable (see Division 5).
Note 2: A finding under paragraph (a) means that a tax offset will not be available for expenditure incurred in acquiring, or in acquiring the right to use, the technology for the R&D activities (see subsection 355‑225(2) of the Income Tax Assessment Act 1997 ).
11 Subsections 28E(3) and (4)
Repeal the subsections.
12 At the end of Subdivision D of Division 3 of Part III
Add:
28EA Causing core technology findings to be made
(1) If:
(a) an R&D entity applies for a finding under subsection 28E(1) about the R&D entity, one or more R&D activities and particular technology; or
(b) the Commissioner:
(i) requests a finding under subsection 28E(1) about one or more R&D activities, and particular technology, that are related to an R&D entity; and
(ii) does not later withdraw the request;
the Board must:
(c) make a finding under that subsection about the R&D activities and the technology; or
(d) if justified in accordance with the decision‑making principles—refuse to make a finding under that subsection about the R&D activities and the technology.
Note 1: For requirements of applications by R&D entities, see section 28G.
Note 2: Refusing to make a finding is reviewable (see Division 5).
Note 3: Section 32A deals with the decision‑making principles.
(2) The Board may also make a finding under subsection 28E(1) on its own initiative in accordance with any applicable decision‑making principles.
Note: Section 32A deals with the decision‑making principles.
13 Section 28F (heading)
Repeal the heading, substitute:
28F Notice of findings or of decisions refusing to make findings
14 Subsections 28F(1) and (2)
Repeal the subsections, substitute:
(1) The Board must notify an R&D entity in writing of any findings, and of any decisions refusing to make findings, under this Division that are related to the R&D entity.
15 Subsection 28F(3)
Omit "or (2)".
16 Subsection 28F(3) (note)
Omit "applicant's", substitute "R&D entity's".
17 Subsection 28F(4)
Omit "the notice if the notice includes one or more certificates", substitute "each notice under subsection (1) of a finding".
18 Subsection 28G(1) (heading)
Repeal the heading, substitute:
Applications by R&D entities for findings
19 Subsection 28G(2)
Omit "An", substitute "However, an".
20 Subsection 28H(1)
Repeal the subsection, substitute:
(1) The Board may request an R&D entity in writing to give such specified information, or specified kinds of information, to the Board as the Board believes could be relevant to the making of a finding under this Division that is related to the R&D entity.
(1A) However, if as described in section 28B another entity applied for the finding on behalf of the R&D entity, the Board must first request in writing the information or kinds of information from that other entity.
21 Subsection 28H(2)
Omit "The request", substitute "A request under subsection (1) or (1A)".
22 Subsection 28H(2) (note 3)
Repeal the note, substitute:
Note 3: A failure to give the information may result in a refusal to make a finding.
23 Subsection 28H(3)
Omit "The request", substitute "A request under subsection (1) or (1A)".
24 Subsection 28H(4)
After "subsection (1)", insert "or (1A)".
25 Section 30A (table items 11 to 13)
Repeal the items, substitute:
26 Subsection 30B(2) (note)
Omit "or 11", substitute ", 11, 12 or 13".
27 At the end of section 32A
Add:
; (d) whether making a finding under Division 3 on its own initiative is justified.
28 Paragraph 47(2A)(c)
Omit "or the Income Tax Assessment Act 1997 ", substitute ", theIncome Tax Assessment Act 1997 or Division 48 in Schedule 1 to theTaxation Administration Act 1953 ".
29 At the end of subsection 47(2A)
Add:
Note: Division 48 in Schedule 1 to the Taxation Administration Act 1953 is about crediting the R&D tax offset on a quarterly basis.
Part 3—Other amendments
Income Tax Assessment Act 1936
30 After subsection 262A(2AAE)
Insert:
(2AAF) Subsection (1) applies to an entity for whom a varied amount applies under section 48‑210 in Schedule 1 to the Taxation Administration Act 1953 even if the entity is not carrying on a business.
Income Tax Assessment Act 1997
31 Subparagraph 355 ‑705(1)(a)(iii)
Omit "about", substitute "relating to".
32 Subsection 355 ‑705(1)
Omit all the words after "the finding binds the Commissioner", substitute:
for the purposes of:
(c) assessments of the R&D entity for the income year or years (as appropriate); and
(d) for a finding under section 28E of that Act—the R&D entity's participation in the *quarterly credits system for the *instalment quarters in the income years.
33 Subsections 355 ‑705(2) and (3)
Repeal the subsections, substitute:
Advance findings about activities yet to be completed
(2) If:
(a) *Innovation Australia makes a finding under subsection 28A(1) of the Industry Research and Development Act 1986 relating to an *R&D entity and all or part of an activity; and
(b) Innovation Australia gives the Commissioner a certificate under that Act setting out the finding; and
(c) the activity is being conducted, or is yet to be conducted, during the income year applying under subsection 28A(3) of that Act for the finding;
the finding binds the Commissioner for the purposes of:
(d) assessments of the R&D entity for the income year and the next 2 income years; and
(e) the R&D entity's participation in the *quarterly credits system for the *instalment quarters in the income year or in the next 2 income years.
Advance findings about completed activities
(3) However, if that activity is completed during the income year applying under subsection 28A(3) of that Act for that finding, that finding binds the Commissioner for the purposes of:
(a) assessments of the *R&D entity for the income year; and
(b) the R&D entity's participation in the *quarterly credits system for the *instalment quarters in the income year.
34 Subparagraph 355 ‑710(1)(a)(iii)
Repeal the subparagraph, substitute:
(iii) a finding under section 28A or 28C of that Act relating to an R&D entity and all or part of an activity conducted or to be conducted during one or more income years; or
35 Subparagraph 355 ‑710(1)(a)(iv)
Omit "about", substitute "relating to".
36 Subsection 721 ‑10(2) (after table item 60)
Insert:
37 Subsection 995 ‑1(1)
Insert:
managing entity , in relation to you, is an entity set out in a table item in subsection 48‑110(2) in Schedule 1 to theTaxation Administration Act 1953 that applies to you.
38 Subsection 995 ‑1(1)
Insert:
quarterly credit amount has the meaning given by section 48‑200 in Schedule 1 to theTaxation Administration Act 1953 .
39 Subsection 995 ‑1(1)
Insert:
quarterly credit due day has the meaning given by section 48‑235 in Schedule 1 to theTaxation Administration Act 1953 .
40 Subsection 995 ‑1(1)
Insert:
quarterly credits system means the system described in Division 48 in Schedule 1 to theTaxation Administration Act 1953 for providing quarterly credits during an income year for certain *tax offsets to which entities expect to be entitled for the income year.
Taxation Administration Act 1953
41 Subsection 8AAB(4) (after table item 44)
Insert:
42 Subsection 250 ‑10(2) in Schedule 1 (after table item 135)
Insert:
43 Subsection 286 ‑75(2) in Schedule 1
After "these Acts", insert "or provisions".
44 At the end of subsection 286 ‑75(2) in Schedule 1
Add:
; or (d) subsection 48‑405(1) in this Schedule.
45 Paragraph 288 ‑20(b) in Schedule 1
Omit "electronically;", substitute "electronically; or".
46 After paragraph 288 ‑20(b) in Schedule 1
Insert:
(c) under subsection 48‑820(1) in this Schedule is required to pay an amount electronically or by an approved method;
47 Paragraph 298 ‑5(c) in Schedule 1
After "Division 16", insert "or 48".
48 Subsection 355 ‑65(4) in Schedule 1 (table item 6)
Repeal the item, substitute:
49 Subsections 444 ‑120(1) and (6) in Schedule 1
Before "the *MRRT law", insert "Division 48 or".
Taxation (Interest on Overpayments and Early Payments) Act 1983
50 After Part IIIAA
Insert:
Part IIIAB—Interest on delayed payments under quarterly credits system
12BA Definitions
In this Part:
assessment day means the day the Commissioner makes an assessment (within the meaning of theIncome Tax Assessment Act 1997 ):
(a) of the total of the entity's tax offset refunds (within the meaning of the Income Tax Assessment Act 1997) for the year of income for which the quarterly credits system amount is payable; or
(b) that the entity can get no such refunds for that year of income.
instalment quarter has the same meaning as in theIncome Tax Assessment Act 1997 .
interest start day has the meaning given by section 12BB.
quarterly credits system amount means:
(a) a quarterly credit amount (within the meaning of the Income Tax Assessment Act 1997); or
(b) an amount repayable under subsection 48‑430(1) in Schedule 1 to the Taxation Administration Act 1953 .
RBA has the same meaning as in section 8AAZA of theTaxation Administration Act 1953 .
RBA surplus has the same meaning as in section 8AAZA of theTaxation Administration Act 1953 .
12BB Meaning of interest start day
(1) The interest start day , for a quarterly credits system amount, is:
(a) if the amount is a quarterly credit amount (within the meaning of the Income Tax Assessment Act 1997 )—the amount's quarterly credit due day (within the meaning of that Act); or
(b) if the amount is an amount repayable under subsection 48‑430(1) in Schedule 1 to the Taxation Administration Act 1953 —the last day the amount is repayable under that subsection.
(2) However, if on that day your circumstances do not enable the amount to be paid to you in accordance with subsection 48‑820(1) in Schedule 1 to the Taxation Administration Act 1953 , the amount'sinterest start day is the 14th day after the day the Commissioner becomes aware that your circumstances have changed to enable the amount to be paid to you in accordance with that subsection.
Note: Subsection 48‑820(1) in Schedule 1 to the Taxation Administration Act 1953 is about electronic payments etc.
12BC Interest for late refunds of RBA surpluses after amounts become payable
(1) If:
(a) disregarding subsections 48‑225(2) and (3) in Schedule 1 to the Taxation Administration Act 1953 :
(i) a quarterly credits system amount is payable to an entity; and
(ii) that amount is to be allocated to an RBA of the entity; and
(iii) on that amount's interest start day, the Commissioner is required under subsection 8AAZLF(1) of the Taxation Administration Act 1953 to refund to the entity an RBA surplus for that RBA; and
(b) all or part of the refund takes place after that interest start day;
then interest is payable by the Commissioner to the entity on so much of the refund as takes place after that interest start day.
(2) Interest under this Part is payable for the period:
(a) starting on the day after that interest start day; and
(b) ending at the earlier of:
(i) the day the refund finishes taking place; and
(ii) the assessment day.
12BD Interest for late payments of amounts
(1) If:
(a) disregarding subsections 48‑225(2) and (3) in Schedule 1 to the Taxation Administration Act 1953 :
(i) a quarterly credits system amount is payable to an entity; and
(ii) that amount is not allocated to an RBA of the entity; and
(b) the Commissioner pays all or part of that amount to the entity after that amount's interest start day;
then interest is payable by the Commissioner to the entity on so much of that amount as is paid after that interest start day.
(2) Interest under this Part is payable for the period:
(a) starting on the day after that interest start day; and
(b) ending at the earlier of:
(i) the day that amount is completely paid to the entity; and
(ii) the assessment day.
12BE Rate of interest
Interest under this Part is payable at the base interest rate (within the meaning of the Income Tax Assessment Act 1997 ).
Tax Laws Amendment (Research and Development) Act 2011
51 Subsection 2(1) (table item 7)
Omit "Schedules 3A and 4", substitute "Schedule 4".
52 Schedule 3A
Repeal the Schedule.
Part 4—Application and transitional provisions
53 Application of amendments
(1) The amendments made by Parts 1 and 3 of this Schedule apply in relation to instalment quarters starting on or after 1 January 2014.
(2) The amendments made by Part 2 of this Schedule apply in relation to processes for making findings that start on or after the commencement of that Part.
Note: Part 2 relates to findings under Division 3 of Part III of the Industry Research and Development Act 1986 .
54 Transitional—current findings of Innovation Australia
(1) This item applies to a finding of the Board if:
(a) the finding was made under subsection 28A(1), 28C(1) or 28E(1) of the Industry Research and Development Act 1986 ; and
(b) the finding was in force immediately before the commencement of this item.
(2) The finding has effect, after the commencement of this item, as if it had been made under that subsection as amended by this Schedule.
The committee divided. [21:36]
(The Chairman—Senator Marshall)
(1) Clause 2, page 1 (lines 7 to 9), omit the clause, substitute:
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.
(2) Schedule 1, page 3 (line 1) to page 4 (line 13), omit the Schedule, substitute:
Schedule 1—Reduced tax offset rate for expenditure above $100 million
Part 1—Main amendments
Income Tax Assessment Act 1997
1 Subsection 67‑30(1)
Before "the amount", insert "all or part of".
2 Section 67‑30 (note 2)
Repeal the note, substitute:
Note 2: This subsection can apply to an entitlement under any subsection of section 355‑100.
3 Subsection 355‑100(1) (heading)
Repeal the heading, substitute:
If notional deductions are between $20,000 and $100 million
4 At the end of section 355‑100
Add:
If notional deductions exceed $100 million
(3) Despite subsection (1), if the total of those amounts exceeds $100 million, the *R&D entity is instead entitled to a *tax offset for the income year equal to the sum of:
(a) that percentage of $100 million; and
(b) the product of the excess and the *corporate tax rate.
Note: The R&D entity may be able to reduce related amounts that would otherwise be:
(a) included in its assessable income because of a balancing, or feedstock, adjustment; or
(b) payable as extra income tax because of an R&D recoupment;
(see section 355‑720).
5 At the end of section 355‑525
Add:
Amount to be included in assessable income may be reduced if notional deductions exceeded $100 million
(4) For the purposes of subsection (3), the partner may choose to reduce the adjusted section 40‑285 amount in that subsection if:
(a) subsection 355‑100(3) applied to the partner for an earlier income year or the event year (the excess year ); and
(b) the partner's deductions for the excess year included deductions covered by paragraph (1)(c) of this section for the asset.
(5) Subsection 355‑720(3) applies to the partner as if a reduction under subsection (2) of that section for the present year included a reduction under subsection (4) of this section for the event year.
(6) The way the partner prepares its income tax returns is sufficient evidence of the making of a choice under subsection (4).
(7) A choice under subsection (4) is irrevocable.
6 At the end of Subdivision 355‑W
Add:
355‑720 Certain related amounts may be reduced if notional deductions exceeded $100 million
(1) The object of this section is to prevent the portion of a *tax offset worked out using the *corporate tax rate being clawed back in later income years.
Note: This applies when the R&D entity's notional deductions exceed $100 million (see subsection 355‑100(3)).
(2) For the purposes of working out a matter referred to in column 1 of an item of this table for an income year (the present year ), the *R&D entity may choose to reduce the amount referred to in column 3 of that item if:
(a) subsection 355‑100(3) applied to the R&D entity for an earlier income year or the present year (the excess year ); and
(b) the R&D entity's deductions for the excess year included deductions covered by a provision referred to in column 2 of that item.
Note 1: Item 2 is about R&D recoupments and item 3 is about feedstock adjustments.
Note 2: Reducing the amount in column 3 will reduce the amount in column 1.
(3) The *R&D entity's circumstances may allow it to choose multiple reductions under subsection (2) for the present year. The total of any reductions cannot be more than the amount of its excess under subsection 355‑100(3) for the excess year.
(4) The way an *R&D entity prepares its income tax returns is sufficient evidence of the making of a choice under this section.
(5) A choice under this section is irrevocable.
355‑750 Review of rate when notional deductions exceed $100 million
(1) The Minister must cause a review of the operation of subsection 355‑100(3) (about the rate of tax offset when notional deductions exceed $100 million) to be undertaken as soon as possible after the fifth anniversary of the commencement of that subsection.
(2) The Minister must cause a copy of the report of the review to be tabled in each House of the Parliament within 15 sitting days of receiving it.
Income Tax (Transitional Provisions) Act 1997
7 After subsection 355‑325(4)
Insert:
Amount to be included in assessable income may be reduced if notional deductions exceeded $100 million
(4A) For the purposes of subsection (4), the partner may choose to reduce the adjusted section 40‑285 amount in that subsection if:
(a) subsection 355‑100(3) of the Income Tax Assessment Act 1997 applied to the partner for an earlier income year or the event year (theexcess year ); and
(b) the partner's deductions for the excess year included deductions covered by paragraph (1)(c) of this section for the asset.
(4B) Subsection 355‑720(3) of the Income Tax Assessment Act 1997 applies to the partner as if a reduction under subsection (2) of that section for the present year included a reduction under subsection (4A) of this section for the event year.
(4C) The way the partner prepares its income tax returns is sufficient evidence of the making of a choice under subsection (4A).
(4D) A choice under subsection (4A) is irrevocable.
8 At the end of Division 355
Add:
Subdivision 355‑W—Other matters
Table of sections
355‑720 Certain related amounts may be reduced if notional deductions exceeded $100 million
355‑720 Certain related amounts may be reduced if notional deductions exceeded $100 million
Section 355‑720 of the Income Tax Assessment Act 1997 also applies as if the table in subsection (1) of that section included the following item:
9 Application of amendments
The amendments made by this Part apply relation to an R&D entity's assessments for income years commencing on or after 1 July 2014.
Part 2—Amendments commencing on 1 July 2024
Income Tax Assessment Act 1997
10 Subsection 67‑30(1)
Omit "all or part of".
11 Subsection 355‑100(1) (heading)
Repeal the heading, substitute:
If notional deductions are at least $20,000
12 Subsection 355‑100(3)
Repeal the subsection.
13 Subsections 355-525(4) to (7)
Repeal the subsections.
14 Sections 355‑720 and 355‑750
Repeal the sections.
Income Tax (Transitional Provisions) Act 1997
15 Subsections 355-325(4A) to (4D)
Repeal the subsections.
16 Subdivision 355-W
Repeal the Subdivision.
17 Application of amendments
The amendments made by this Part apply in relation to an R&D entity's assessments for income years commencing on or after 1 July 2024.
(1) Amendment (2), item 9, omit "1 July 2014", substitute "1 July 2016".
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