(5) For the purposes of this section, where, because of section 101, a beneficiary is presently entitled to a particular amount, the amount is taken to have been paid to the beneficiary.
(6) For the purposes of this section, the extent to which an amount referred to in subparagraph (1)(c)(i) or (ii) (in this subsection called the taxed amount) represents the amount covered by paragraph (1)(b) (in this subsection called the listed country trust amount) is calculated using the formula:
Start formula Taxed amount times start fraction Listed country trust amount over Net income end fraction end formula
where:
Listed country trust amount means the number of dollars in the listed country trust amount.
Taxed amount means the taxed amount.
Net income means the number of dollars in the net income of the non‑resident trust estate concerned of the year of income concerned.
102AAV Double tax agreements to be disregarded
In calculating the attributable income of a trust estate, the International Tax Agreements Act 1953 is to be disregarded, except for the purpose of references in this Act to that Act.
102AAW Certain provisions to be disregarded in calculating attributable income
(1) For the purpose of applying this Act in calculating the attributable income of a trust estate, sections 23AI, 128D, 456, 457, and 459A of this Act and section 802‑15 of the Income Tax Assessment Act 1997 are to be disregarded.
(2) For the purpose of applying this Act in calculating the attributable income of a trust estate:
(aa) Division 230 of the Income Tax Assessment Act 1997; and
(a) Division 974 of the Income Tax Assessment Act 1997; and
(b) the operation of any provision of this Act to the extent to which that operation depends on an expression whose meaning is given by a Division mentioned in paragraph (aa) or (a);
are to be disregarded.
102AAY Modified application of trading stock provisions
When applying this Act and the Income Tax Assessment Act 1997 in calculating the attributable income of the trust estate, Division 70 of the Income Tax Assessment Act 1997 has effect as if the cost of the item of trading stock were the value to be taken into account at the start of the year of income.
102AAZ Modified application of depreciation provisions
(1) For the purpose of determining the attributable income of a trust estate of a year of income (in this section called the attributable year of income), where property has been held by the trustee of the trust estate in a non‑attributable year of income before the attributable year of income, then, in relation to the application of a depreciation provision to the property, subsection (2) applies.
(2) Such amount as the Commissioner considers appropriate to take account of the holding of the property as mentioned in subsection (1) is, under the depreciation provision:
(a) an allowable deduction to the trustee of the trust estate; or
(b) included in the assessable income of the trust estate;
as the case requires, for the attributable year of income in substitution for any amount that would otherwise be so included or allowable.
(4) For the purpose of exercising the Commissioner’s power under subsection (2) in relation to deductions allowable under Division 40 of the Income Tax Assessment Act 1997, the Commissioner must assume that the property was used by the trustee of the trust estate during any non‑attributable year of income wholly and exclusively for a taxable purpose (within the meaning of that Division).
102AAZB General modifications—CGT
For the purposes of applying this Act in calculating the attributable income of a trust estate, Parts 3‑1 and 3‑3 of the Income Tax Assessment Act 1997 (about CGT) apply as if:
(a) sections 118‑12 (about assets used to produce non‑assessable income) and 855‑50 (about a trust becoming a resident trust) were disregarded; and
(b) the trust estate were a resident trust for CGT purposes.
102AAZBA Modified application of CGT—effect of certain changes of residence
For the purposes of applying this Act in calculating the attributable income of a trust estate of a year of income (in this section called the attributable income year), where:
(a) disregarding the assumption in paragraph 102AAZB(b), at any time (in this section called the residence‑change time) during the attributable income year or an earlier year of income, the trust estate ceased to be a resident trust for CGT purposes and became a non‑resident trust estate; and
(b) the trust estate owned a CGT asset at the residence‑change time; and
(c) a CGT event happens in relation to the asset during the attributable income year; and
(d) section 104‑170 of the Income Tax Assessment Act 1997 (CGT event I2) applies to the asset in respect of the change of residence for the purposes of the application of this Act apart from this Subdivision;
then sections 411 to 414 (inclusive) apply to the asset as if:
(e) those sections had effect for the purposes of calculating attributable income under this Subdivision instead of Part X; and
(f) any reference in those sections to an eligible CFC were a reference to the trust estate; and
(g) any reference in those sections to a commencing day asset were a reference to the asset; and
(h) any reference in those sections relating to the eligible CFC’s commencing day or the day following the eligible CFC’s commencing day were a reference relating respectively to the residence‑change time or a time immediately after the residence‑change time; and
(j) subsections 412(2) and (3), and paragraphs 414(3)(b) and (4)(b), referred only to the market value of the asset concerned.
102AAZC Modified application of loss provisions—pre‑1990‑91 losses
In calculating the attributable income of a trust estate of a year of income, no deductions are allowable under Division 36 of the Income Tax Assessment Act 1997 in respect of tax losses of a year of income earlier than the year of income commencing on 1 July 1990.
102AAZD Assessable income of attributable taxpayer to include attributable income of trust estate to which taxpayer has transferred property or services
(1) Subject to section 102AAZE and to this section, if:
(a) an entity is an attributable taxpayer:
(i) in relation to the year of income of the taxpayer commencing on 1 July 1990 (which year of income is in this section called the taxpayer’s current year of income) or in relation to a subsequent year of income of the taxpayer (which year of income is in this section also called the taxpayer’s current year of income); and
(ii) in relation to a trust estate; and
(b) any part of a non‑resident year of income of the trust estate occurs during the taxpayer’s current year of income; and
(c) the taxpayer is a resident at any time during the taxpayer’s current year of income;
the assessable income of the taxpayer of the taxpayer’s current year of income includes:
(d) if the taxpayer is a resident at all times during the taxpayer’s current year of income—the whole of the notional attributable income of the trust estate of the taxpayer’s current year of income; or
(e) if the taxpayer is a resident for only part of the taxpayer’s current year of income—the amount calculated using the formula:
Start formula Notional attributable income times start fraction Days in residency period over Days in year of income end fraction end formula
where:
Notional attributable income means the notional attributable income of the trust estate of the taxpayer’s current year of income.
Days in residency period means the number of whole days during the taxpayer’s current year of income when the taxpayer was a resident.
Days in year of income means the number of whole days in the taxpayer’s current year of income.
(2) A reference in subsection (1) to the notional attributable income of the trust estate of the taxpayer’s current year of income is a reference to:
(a) if there is a year of income of the trust estate that begins at the same time as the beginning of the taxpayer’s current year of income—the attributable income of the trust estate of that year of income; or
(b) in any other case—the amount obtained:
(i) by calculating, for each year of income of the trust estate (in this paragraph called the trust’s year of income) any part of which occurs during the taxpayer’s current year of income, the amount calculated using the formula:
Start formula Attributable income times start fraction Days in overlapping period over Days in trust’s year of income end fraction end formula
where:
Attributable income means the attributable income of the trust estate of the trust’s year of income.
Days in overlapping period means the number of whole days in the trust’s year of income that occurred during the taxpayer’s current year of income.
Days in trust’s year of income means the number of whole days in the trust’s year of income; and
(ii) by adding together the amounts calculated under subparagraph (i).
(3) If:
(a) an amount is included in the assessable income of an attributable taxpayer of the taxpayer’s current year of income under subsection (1); and
(b) before or during the taxpayer’s current year of income, one or more entities other than the taxpayer have transferred property or services to the trust estate concerned; and
(c) the taxpayer gives to the Commissioner, in accordance with the approved form, such information in connection with the operation of this Division as is required by the form to be set out;
the Commissioner may reduce the amount included in the taxpayer’s assessable income of the taxpayer’s current year of income under subsection (1) having regard to:
(d) the extent to which the attributable income of the trust estate is, in the opinion of the Commissioner, attributable to property or services transferred by the taxpayer; and
(e) such other matters as the Commissioner considers relevant.
(4) If:
(a) apart from this subsection, an amount would be included in the assessable income of an attributable taxpayer of the taxpayer’s current year of income under subsection (1) in relation to a particular trust estate; and
(b) the taxpayer could not reasonably be expected to obtain the information required to determine the attributable income of the trust estate;
the following provisions have effect:
(c) no amount is to be included in the assessable income of the taxpayer of the taxpayer’s current year of income under subsection (1) in relation to the trust estate;
(d) the assessable income of the taxpayer of the taxpayer’s current year of income includes the amount obtained:
(i) if any of the transfers that were taken into account in determining whether the taxpayer was an attributable taxpayer in relation to the taxpayer’s current year of income and in relation to the trust estate were made by the taxpayer to the trust estate after the IP time—by calculating, for each such transfer, the amount calculated using the formula:
Start formula Adjusted value of the transfer times open bracket Weighted statutory interest rate plus 5% close bracket end formula
where:
Adjusted value of the transfer has the meaning given by subsection (5).
Weighted statutory interest rate means the weighted statutory interest rate in relation to the taxpayer’s current year of income; and
(ii) if any of the transfers that were taken into account in determining whether the taxpayer was an attributable taxpayer in relation to the taxpayer’s current year of income and in relation to the trust estate were made by the taxpayer to the trust estate before the IP time—the amount calculated using the formula:
Start formula Adjusted net worth of trust estate times open bracket Weighted statutory interest rate plus 5% close bracket end formula
where:
Adjusted net worth of trust estate has the meaning given by subsection (6).
Weighted statutory interest rate means the weighted statutory interest rate in relation to the taxpayer’s current year of income; and
(iii) by adding together the amounts calculated under subparagraphs (i) and (ii).
(5) For the purposes of subsection (4), the adjusted value of a transfer of property or services made by an attributable taxpayer to a trust estate is:
(a) if the transfer occurred during the taxpayer’s current year of income—the amount calculated using the formula:
Start formula Market value of transferred property or services times start fraction Days after transfer over Days in year of income end fraction end formula
where:
Market value of transferred property or services means the market value, immediately before the transfer, of the property or services.
Days after transfer means the number of whole days in the taxpayer’s current year of income after the day on which the transfer took place.
Days in year of income means the number of whole days in the taxpayer’s current year of income; or
(b) if the transfer of the property or services occurred before the taxpayer’s current year of income—the sum of:
(i) the market value, immediately before the transfer, of the property or services; and
(ii) the amount obtained:
(A) by calculating, in respect of the transfer, for each year of income preceding the taxpayer’s current year of income, the amount ascertained using the formula in subparagraph (4)(d)(i); and
(B) by adding together the amounts calculated under sub‑subparagraph (A).
(6) For the purposes of the application of subsection (4) in relation to a transfer of property or services made by an attributable taxpayer to a trust estate, the adjusted net worth of the trust estate is:
(a) if the taxpayer’s current year of income is the year of income commencing on 1 July 1990—the 1 July 1990 net worth of the trust estate; or
(b) in any other case—the sum of:
(i) the 1 July 1990 net worth of the trust estate; and
(ii) the amount obtained:
(A) by calculating, in respect of the transfer, for each year of income preceding the taxpayer’s current year of income, the amount ascertained using the formula in subparagraph (4)(d)(ii); and
(B) by adding together the amounts calculated under sub‑subparagraph (A).
(7) If:
(a) subsection (4) applies to an attributable taxpayer in relation to the taxpayer’s current year of income; and
(b) any of the transfers taken into account in determining whether the taxpayer was an attributable taxpayer in relation to the taxpayer’s year of income and in relation to the trust estate concerned were made before the IP time; and
(c) the taxpayer gives to the Commissioner, in accordance with the approved form, such information in connection with the operation of this Division as is required by the form to be set out;
the Commissioner may reduce the amount included in the taxpayer’s assessable income of the taxpayer’s current year of income under subsection (4) having regard to:
(d) the extent to which the market value, as at the beginning of the taxpayer’s current year of income, of the assets of the trust estate is, in the opinion of the Commissioner, attributable to property or services transferred by the taxpayer before the IP time; and
(e) such other matters as the Commissioner considers relevant.
102AAZE Accruals system of taxation does not apply to small amounts
An amount is not to be included in the assessable income of the taxpayer of a year of income under section 102AAZD in relation to a trust estate that is a listed country trust estate in relation to the year of income if the amount obtained by:
(a) identifying each trust estate in relation to which the taxpayer is an attributable taxpayer in relation to the year of income; and
(b) calculating the attributable income of the year of income of each such trust estate; and
(c) adding the amounts calculated under paragraph (b);
does not exceed the lesser of the following amounts:
(d) $20,000;
(e) 10% of the total of the net incomes of each of those trust estates of the year of income.
102AAZF Only resident partners, beneficiaries etc. liable to be assessed as a result of attribution
Section 460 applies to an amount included in the assessable income of a taxpayer under section 102AAZD in a corresponding way to the way in which section 460 applies to an amount included in the assessable income of a taxpayer under section 456 or 457 and, for the purposes of that corresponding application, references in sections 336, 338 and 460 to a Part X Australian resident are to be read as references to a resident within the meaning of section 6.
102AAZG Keeping of records
(1) Subject to this section, a person who is an attributable taxpayer:
(a) in relation to the year of income of the person commencing on 1 July 1990 or in relation to a subsequent year of income of the person; and
(b) in relation to a particular trust estate;
must keep records (in Australia or elsewhere) containing particulars of:
(c) the acts, transactions and other circumstances that resulted in the person being an attributable taxpayer in relation to that year of income and in relation to that trust estate; and
(d) except where subsection 102AAZD(4) applies in relation to the trust estate and in relation to the year of income of the person—the basis of the calculation of the attributable income of the trust estate for each year of income of the trust estate any part of which occurred during the year of income of the person; and
(e) the basis of the calculation of the amounts (including nil amounts) included in the assessable income of the person of the year of income of the person under section 102AAZD.
Note: There is an administrative penalty if you do not keep or retain records as required by this section: see section 288‑25 in Schedule 1 to the Taxation Administration Act 1953.
(2) A person who contravenes subsection(1) commits an offence punishable on conviction by a fine not exceeding 30 penalty units.