Schedule 3 — Non-payment of family tax benefit for non-lodgment of tax returns

A New Tax System (Family Assistance) (Administration) Act 1999

1  After subsection 32AB(1)

Insert:

          (1A)  However, there is not a prohibited period for the claimant under subsection (1) because of a variation mentioned in section 32AA if:

                     (a)  no debt arose under section 71 as a result of that variation; or

                     (b)  a debt arose under section 71 as a result of that variation, but no amount of that debt is outstanding at the end of the grace period.

2  Paragraph 32AB(2)(b)

After “(4)”, insert “, (4A)”.

3  After subsection 32AB(4)

Insert:

          (4A)  This subsection applies if:

                     (a)  a debt arose under section 71 as a result of the variation mentioned in section 32AA; and

                     (b)  an amount of that debt was outstanding at the end of the grace period; and

                     (c)  at a time after the end of the grace period, no amount of that debt is outstanding.

4  After subsection 32AB(5)

Insert:

          (5A)  However, there is not a prohibited period for the claimant under subsection (5) because of a variation mentioned in section 32AA if:

                     (a)  no debt arose under section 71 as a result of that variation; or

                     (b)  a debt arose under section 71 as a result of that variation, but no amount of that debt is outstanding immediately before the day that would, apart from this subsection, be determined under paragraph (6)(a).

5  Subparagraph 32AB(6)(b)(iii)

After “subsection”, insert “(6A) or”.

6  After subsection 32AB(6)

Insert:

          (6A)  This subsection applies if:

                     (a)  a debt arose under section 71 as a result of the variation mentioned in section 32AA; and

                     (b)  an amount of that debt was outstanding immediately before the day determined under paragraph (6)(a); and

                     (c)  at a time on or after that day, no amount of that debt is outstanding.

7  After subsection 32AC(1)

Insert:

          (1A)  However, there is not a prohibited period for the relevant partner under subsection (1) because of a variation mentioned in section 32AA if:

                     (a)  no debt arose under section 71 as a result of that variation; or

                     (b)  a debt arose under section 71 as a result of that variation, but no amount of that debt is outstanding at the end of the grace period.

8  Paragraph 32AC(2)(b)

After “(4)”, insert “, (4A)”.

9  After subsection 32AC(4)

Insert:

          (4A)  This subsection applies if:

                     (a)  a debt arose under section 71 as a result of the variation mentioned in section 32AA; and

                     (b)  an amount of that debt was outstanding at the end of the grace period; and

                     (c)  at a time after the end of the grace period, no amount of that debt is outstanding.

10  After subsection 32AC(5)

Insert:

          (5A)  However, there is not a prohibited period for the relevant partner under subsection (5) because of a variation mentioned in section 32AA if:

                     (a)  no debt arose under section 71 as a result of that variation; or

                     (b)  a debt arose under section 71 as a result of that variation, but no amount of that debt is outstanding immediately before the day that would, apart from this subsection, be determined under paragraph (6)(a).

11  Paragraph 32AC(6)(b)

After “(8)”, insert “, (8A)”.

12  After subsection 32AC(8)

Insert:

          (8A)  This subsection applies if:

                     (a)  a debt arose under section 71 as a result of the variation mentioned in section 32AA; and

                     (b)  an amount of that debt was outstanding immediately before the day determined under paragraph (6)(a); and

                     (c)  at a time on or after that day, no amount of that debt is outstanding.

13  Subsection 32AE(1)

After “3”, insert “or more”.

Note:       The heading to section 32AE is altered by inserting “ or more ” after “ 3 ”.

14  Subsections 32AE(2) and (3)

Repeal the subsections, substitute:

Claimant

             (2)  The claimant is not entitled to be paid family tax benefit (worked out on the basis referred to in subsection 20(1), (2A) or (3)) for a period if, throughout that period, both subsections (3) and (4) of this section apply in relation to one or more of the cancellation income years concerned.

Note 1:       For cancellation income year see subsection 28(1).

Note 2:       Subsection (8) creates an exception to subsection (2).

             (3)  This subsection applies in relation to a cancellation income year if either or both of the following apply:

                     (a)  if the claimant was required to lodge an income tax return for that year—the claimant has not lodged that return;

                     (b)  if the claimant is a member of a couple and the claimant’s partner is a relevant partner in relation to that year and that partner was required to lodge an income tax return for that year—that partner has not lodged that return.

Note:          For relevant partner see section 32AA.

             (4)  This subsection applies in relation to a cancellation income year if a debt arose under section 71 as a result of the variation concerned and an amount of that debt is outstanding.

Partner

             (5)  If the claimant is a member of a couple, the claimant’s partner is not entitled to be paid family tax benefit (worked out on the basis referred to in subsection 20(1), (2A) or (3)) for a period if, throughout that period, both subsections (6) and (7) of this section apply in relation to one or more of the cancellation income years concerned.

Note 1:       For cancellation income year see subsection 28(1).

Note 2:       Subsection (9) creates an exception to subsection (5).

             (6)  This subsection applies in relation to a cancellation income year if either or both of the following apply:

                     (a)  if the claimant was required to lodge an income tax return for that year—the claimant has not lodged that return;

                     (b)  if the claimant’s partner is a relevant partner in relation to that year and that partner was required to lodge an income tax return for that year—that partner has not lodged that return.

Note:          For relevant partner see section 32AA.

             (7)  This subsection applies in relation to a cancellation income year if a debt arose under section 71 as a result of the variation concerned and an amount of that debt is outstanding.

Exceptions

             (8)  The Secretary may, by writing, determine that subsection (2) does not apply in relation to a specified person and to a specified period if the Secretary is satisfied that there are special circumstances that justify the Secretary doing so.

             (9)  The Secretary may, by writing, determine that subsection (5) does not apply in relation to a specified person and to a specified period if the Secretary is satisfied that there are special circumstances that justify the Secretary doing so.

           (10)  A period specified in a determination under subsection (8) or (9) may be a period beginning before, on or after the day the determination is made.

           (11)  A determination made under subsection (8) or (9) is not a legislative instrument.

15  Application and transitional

(1)       The amendments made by items 1 to 12 apply in relation to variations made before, on or after the commencement of those items.

(2)       Subsection 32AE(1) of the A New Tax System (Family Assistance) (Administration) Act 1999 , as amended by this Act, does not apply in relation to a variation made before the commencement of this item if:

                     (a)  no debt arose under section 71 of that Act as a result of that variation; or

                     (b)  a debt arose under section 71 of that Act as a result of that variation, but no amount of that debt is outstanding immediately before that commencement.