{"id":"F2016L01642","name":"PAYG Withholding variation for foreign resident capital gains withholding payments – marriage or relationship breakdowns","slug":"payg-withholding-variation-for-foreign-resident-capital-gains-withholding-payments-marriage-or-relat","collection":"legislative_instrument","jurisdiction":"commonwealth","status":"in_force","isInForce":true,"actNumber":null,"makingDate":null,"administeringDepartment":null,"currentVersion":{"id":95310,"registerId":"commonwealth-F2016L01642-current","compilationNumber":null,"startDate":"2026-04-02","status":"InForce","reasons":null,"registeredAt":null},"sections":[{"sectionNumber":"1","sectionType":"section","heading":"PAYG Withholding variation for foreign resident capital gains withholding payments – marriage or relationship breakdowns","content":"Legislative Instrument\n\nPAYG Withholding variation for foreign resident capital gains withholding payments – marriage or relationship breakdowns\n\nI, Matthew Bambrick, Acting Deputy Commissioner of Taxation, make this variation under subsection 14-235(5) of Schedule 1 to the Taxation Administration Act 1953.\n\nActing Deputy Commissioner of Taxation\n\nDated: 5 October 2016\n\n1.  Name of instrument\n\nThis determination is the PAYG Withholding variation for foreign resident capital gains withholding payments – marriage or relationship breakdowns.\n\n2. Commencement\n\nThis instrument commences on the day after its registration on the Federal Register of Legislative Instruments\n\n3. Application\n\nThis instrument applies to payments covered by section 14-200 of Schedule 1 to the Taxation Administration Act 1953, where\n\n    (i) under the Family Law Act 1975 or under a State law, Territory law or foreign law relating to breakdowns of relationships between spouses, the transferee acquires ownership of an asset; and.\n    (ii) the transferee possesses a copy of the relevant documentation specified in subsection 126-5(1) of the ITAA 1997 by the time of the finalisation of the transfer, showing that the asset was acquired in accordance with subparagraph 3(i).\n\n4. Determination\n\nThe amount to be paid to the Commissioner in relation to transactions covered by this instrument is varied to nil.\n\n5. Definitions\n\n    Spouse - as defined within subsection 995-1(1) of the Income Tax Assessment Act 1997\n    Transferor – the person or entity named in the relevant documentation specified in subsection 126-5(1) of the ITAA 1997, under which the Family Law Act 1975, State law, Territory law or foreign law relating to breakdowns of relationships between spouses, is requiring them to transferor an asset to another individual (transferee).\n    Transferee – the individual who is named in the relevant documentation specified in subsection 126-5(1) of the ITAA 1997 as being in receipt of the ownership of the asset transferred under the Family Law Act 1975 or under a State law, Territory law or foreign law relating to breakdowns of relationships between spouses.\n\nOther terms used in this legislative instrument have the same meaning as defined in the:\n\n Income Tax Assessment Act 1997, or\n\n Taxation Administration Act 1953","sortOrder":0}],"analysis":{"flash_summary":{"complexity_score":4,"scope_assessment":{"changed":true,"description":"This variation narrows the practical scope of the foreign resident capital gains withholding obligation in Schedule 1 s14-200 by exempting transfers that occur because of marriage or relationship breakdowns, provided the transferee holds the documents specified in subsection 126-5(1) ITAA 1997 (see instrument clauses 3 and 4). In effect, withholding liability that would otherwise apply is varied to nil for those defined transfers, shifting the compliance condition to possession and verification of the prescribed documentation."},"complexity_factors":["Cross-references to other statutes: Schedule 1 s14-200 and s14-235(5) of the Taxation Administration Act 1953 and subsection 126-5(1) of the Income Tax Assessment Act 1997.","Reliance on external legal regimes: transfers must arise under the Family Law Act 1975 or equivalent state, territory or foreign laws.","Documentary-condition trigger: nil variation depends on the transferee possessing specified documentation by transfer finalisation (timing and proof issues).","Defined-term reliance: meaning of 'spouse', 'transferor' and 'transferee' and other terms are drawn from other Acts, requiring cross-checking.","Operational verification: administrative need for the Commissioner (or agents) to verify documents and apply the nil variation in practice."],"plain_english_summary":"This instrument sets the foreign resident capital gains withholding amount to nil for transfers that occur because of marriage or relationship breakdowns (under the Family Law Act or equivalent state, territory or foreign law), where the transferee holds the documents listed in subsection 126-5(1) of the ITAA 1997 by the time the transfer is finalised. Mechanically, it removes the requirement to remit a withholding payment in those specific family-law transfers but keeps the burden on the transferee to have and present the specified documentation."},"flash_summary_failed":{"failed":true,"reason":"A positive credit balance is required for all requests, including BYOK, so fallback providers remain available. Add credits at https://vercel.com/d?to=%2F%5Bteam%5D%2F%7E%2Fai%3Fmodal%3Dtop-up to continue.","source":"analysis-cron"},"kimi_summary":{"content_quality":"ok","complexity_score":2,"scope_assessment":{"changed":false,"description":"This instrument maintains a narrow, targeted scope consistent with its original purpose. It addresses a specific administrative gap in the foreign resident capital gains withholding regime for relationship breakdowns, without expanding into broader areas of tax administration."},"complexity_factors":["Very short document (5 sections, ~300 words)","Only 3 defined terms, all referencing existing definitions in other Acts","Single operative provision (section 4) with a straightforward nil variation","Limited conditional logic — only two requirements in section 3(i) and 3(ii)","No nested exceptions or complex cross-referencing beyond standard definitional references"],"plain_english_summary":"This rule exempts transfers of Australian property made as part of a relationship breakdown (divorce or separation) from the foreign resident capital gains withholding requirement, where the transfer is under family law or equivalent and supported by proper paperwork.  \n\nIt spares separating parties—especially recipients of transferred property—from needing to withhold and remit part of the purchase price to the ATO, removing a potentially large cash burden during asset division."}},"importantCases":[],"_links":{"self":"/api/acts/payg-withholding-variation-for-foreign-resident-capital-gains-withholding-payments-marriage-or-relat","history":"/api/acts/payg-withholding-variation-for-foreign-resident-capital-gains-withholding-payments-marriage-or-relat/history","analysis":"/api/acts/payg-withholding-variation-for-foreign-resident-capital-gains-withholding-payments-marriage-or-relat/analysis","conflicts":"/api/acts/payg-withholding-variation-for-foreign-resident-capital-gains-withholding-payments-marriage-or-relat/conflicts","importantCases":"/api/acts/payg-withholding-variation-for-foreign-resident-capital-gains-withholding-payments-marriage-or-relat/important-cases","documents":"/api/acts/payg-withholding-variation-for-foreign-resident-capital-gains-withholding-payments-marriage-or-relat/documents"}}