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Tax and Superannuation Laws Amendment (2015 Measures No. 5) Bill 2015

Schedule 4 Third party reporting

Part 1 Main amendments

Taxation Administration Act 1953

1  At the end of Division 396 in Schedule 1

Add:

Subdivision 396-B Information about transactions that could have tax consequences for taxpayers

Guide to Subdivision 396-B

396-50   What this Subdivision is about

The Commissioner can require certain entities to give information about transactions that could reasonably be expected to have tax consequences for other entities.

Table of sections

Operative provisions

396-55      Reporting tax-related information about transactions to the Commissioner

396-60      Information required

396-65      Exemptions—wholesale clients

396-70      Exemptions—other cases

396-75      Errors in reports

Operative provisions

396-55   Reporting tax-related information about transactions to the Commissioner

                   An entity mentioned in column 1 of an item of this table must:

                     (a)  prepare a report in the * approved form setting out information about any transactions described in that item that happened during this period:

                              (i)  a * financial year; or

                             (ii)  such other period as the Commissioner specifies by legislative instrument for that item; and

                     (b)  give the report to the Commissioner on or before:

                              (i)  the 31st day after the end of that period; or

                             (ii)  such other time after the end of that period as the Commissioner specifies by legislative instrument for that item;

unless section 396-65, or a notice or determination under section 396-70, provides that the entity is not required to do so.

 

Information to be reported by third parties about transactions

 

Column 1

Column 2

Item

This entity:

must report information about this transaction:

1

a government related entity (within the meaning of the * GST Act), other than a * local governing body

the provision of a grant by the entity to an entity that has an * ABN

2

a government related entity (within the meaning of the * GST Act)

the provision of consideration (within the meaning of the * GST Act):

(a) by the entity to an entity; and

(b) wholly or partly for a * supply of services;

unless the supply of services is merely incidental to a supply of goods (within the meaning of the GST Act)

3

a State or Territory

the transfer of a freehold or leasehold interest in real property situated in the State or Territory

4

* ASIC

a transaction about which data has been delivered to * ASIC under the * market integrity rules

5

a participant (within the meaning of Chapter 7 of the Corporations Act 2001 ) in an * Australian financial market

a transaction, involving the participant, that:

(a) results in a change to the type, name or number of * shares in a company, or units in a unit trust, that are held by another entity; and

(b) is a transaction about which data is required to be delivered to * ASIC under the * market integrity rules

6

a company whose * shares are listed for quotation in the official list of an * Australian financial market

a transaction that:

(a) results in a change to the type, name or number of * shares in the company that are held by an entity; and

(b) is not a transaction about which data is required to be delivered to * ASIC under the * market integrity rules

7

the trustee of a unit trust

a transaction that:

(a) results in a change to the type, name or number of units in the unit trust that are held by an entity; and

(b) is not a transaction about which data is required to be delivered to * ASIC under the * market integrity rules

8

the trustee of a trust (other than a unit trust)

a transaction that results in a change to the type, name or number of any * shares in a company, or units in a unit trust:

(a) that are held as assets of the trust; and

(b) to which one or more entities are absolutely entitled as beneficiaries of the trust;

unless the trustee gives the Commissioner an * income tax return for the income year in which the transaction was entered into

9

an administrator of a payment system (within the meaning of the Payment Systems (Regulation) Act 1998 )

a transaction involving an electronic payment if:

(a) the transaction is facilitated by the payment system on behalf of an entity; and

(b) the administrator reasonably believes that the transaction:

(i)   provides a payment to the entity, or provides a refund or cash to a customer of the entity; and

(ii)  is for the purposes of a * business carried on by the entity

Note:          An administrative penalty applies to a failure to give the report by that time (see subsection 286-75(1)). An administrative penalty applies for any false statements in the report (see section 284-75).

396-60   Information required

Transactions not involving market participants

             (1)  For the purposes of section 396-55, the information required by the * approved form about a transaction (other than a transaction described in table item 5 in that section):

                     (a)  must relate to the identification, collection or recovery of a possible * tax-related liability of a party to the transaction (disregarding any exemption under a * taxation law that may apply to those parties); and

                     (b)  may relate to identifying the parties to the transaction; and

                     (c)  for a transaction described in table item 3 in that section—may include the * tax file numbers of those parties to the transaction who have quoted their tax file numbers to the State or Territory concerned.

Transactions involving market participants

             (2)  For the purposes of section 396-55, the information required by the * approved form about a transaction described in table item 5 in that section must relate to identifying the parties to the transaction.

Some reporting entities may request tax file numbers

             (3)  A State or Territory may request an entity to quote the entity’s * tax file number to the State or Territory if:

                     (a)  the tax file number is for a report by the State or Territory under section 396-55 about a transaction described in table item 3 in that section; and

                     (b)  the entity is a party to the transaction.

396-65   Exemptions—wholesale clients

                   An entity is not required to include, in a report under section 396-55, information about a transaction described in table item 5, 6, 7 or 8 in that section to the extent that the information relates to a party to the transaction:

                     (a)  who is not an individual; and

                     (b)  who is being provided a financial product, or a financial service, under the transaction as a wholesale client.

Financial product , financial service and wholesale client have the same meanings in this section as they do in Chapter 7 of the Corporations Act 2001 .

Note:          This exemption does not apply to information relating to any other party to the transaction, such as the party providing the product or service.

396-70   Exemptions—other cases

Exemptions for particular entities

             (1)  The Commissioner may, in writing, notify an entity that it:

                     (a)  is not required to prepare and give reports under section 396-55; or

                     (b)  is not required to do so for specified classes of transactions.

             (2)  An entity dissatisfied with a decision to:

                     (a)  give it a notice under subsection (1); or

                     (b)  not give it a notice under subsection (1);

may object against the decision in the manner set out in Part IVC.

             (3)  A notice under subsection (1) is not a legislative instrument.

General exemptions

             (4)  The Commissioner may, by legislative instrument, determine that specified classes of entities:

                     (a)  are not required to prepare and give reports under section 396-55; or

                     (b)  are not required to do so for specified classes of transactions.

396-75   Errors in reports

             (1)  An entity must give to the Commissioner a corrected report if:

                     (a)  the entity has given a report to the Commissioner under this Subdivision; and

                     (b)  after giving the report, the entity becomes aware of a material error in it.

             (2)  The report must be in the * approved form.

             (3)  The report must be given to the Commissioner no later than 28 days after the entity becomes aware of the error.

Note 1:       An administrative penalty applies to a failure to give the report by that time (see subsection 286-75(1)). An administrative penalty applies for any false statements in the report (see section 284-75).

Note 2:       Section 388-55 allows the Commissioner to defer the time for giving an approved form.

Part 2 Other amendments

Income Tax Assessment Act 1997

2  Subsection 995-1(1)

Insert:

ASIC means the Australian Securities and Investments Commission.

Australian financial market means a financial market (within the meaning of Chapter 7 of the Corporations Act 2001 ) operating under an Australian market licence granted under subsection 795B(1) of that Act.

market integrity rules means rules made under section 798G of the Corporations Act 2001 .

Tax Agent Services Act 2009

3  Paragraph 20-30(2)(b)

Omit “the Australian Securities and Investments Commission”, substitute “ * ASIC”.

4  Paragraph 40-20(3)(b)

Omit “the Australian Securities and Investments Commission”, substitute “ * ASIC”.

5  Subparagraph 60-125(8)(c)(iv)

Omit “the Australian Securities and Investments Commission”, substitute “ * ASIC”.

6  Subparagraph 60-125(8)(d)(iii)

Omit “the Australian Securities and Investments Commission”, substitute “ASIC”.

7  Subsection 70-40(3A) (heading)

Repeal the heading, substitute:

Disclosures to ASIC

8  Subsection 70-40(3A)

Omit “the Australian Securities and Investments Commission”, substitute “ * ASIC”.

9  Subsection 70-40(3A)

Omit “the Commission”, substitute “ASIC”.

Taxation Administration Act 1953

10  Subparagraph 12-400(3)(b)(ii) in Schedule 1

Omit “ASIC”, substitute “ * ASIC”.

11  Subsection 12-403(3) in Schedule 1

Omit “ASIC”, substitute “ * ASIC”.

12  Section 269-50 in Schedule 1

Omit “the Australian Securities and Investments Commission”, substitute “ * ASIC”.

13  Subsection 355-65(3) in Schedule 1 (table item 6A)

Omit “the Australian Securities and Investments Commission”, substitute “ * ASIC”.

14  Paragraph 355-70(4)(l) in Schedule 1

Repeal the paragraph, substitute:

                      (l)  * ASIC.

15  Paragraph 355-70(7)(d) in Schedule 1

Repeal the paragraph, substitute:

                     (d)  * ASIC;

16  Part 5-25 (heading) in Schedule 1

Repeal the heading, substitute:

Part 5-25 Record-keeping and other obligations relating to taxpayers

17  Division 396 in Schedule 1 (heading)

Repeal the heading, substitute:

Division 396 Third party reporting

Table of Subdivisions

             Guide to Division 396

396-A   FATCA

396-B    Information about transactions that could have tax consequences for taxpayers

18  Before section 396-1 in Schedule 1

Insert:

396-1A   What this Division is about

Financial institutions must give the Commissioner information for the purposes of the FATCA Agreement.

Certain entities must give the Commissioner information about transactions that could reasonably be expected to have tax consequences for other entities.

Subdivision 396-A FATCA

Guide to Subdivision 396-A

19  Section 396-1 in Schedule 1 (heading)

Repeal the heading, substitute:

396-1   What this Subdivision is about

20  Before section 396-5 in Schedule 1

Insert:

Operative provisions

21  Subsection 396-20(1) in Schedule 1

Omit “this Division”, substitute “this Subdivision”.

Part 3 Contingent amendments

Division 1—Amendments if the Foreign Acquisitions and Takeovers Legislation Amendment Act 2015 has not already received the Royal Assent

Taxation Administration Act 1953

22  Subsection 355-65(4) in Schedule 1 (table item 1)

Omit “the Australian Securities and Investments Commission ( ASIC )”, substitute “ * ASIC”.

23  Subsection 355-65(4) in Schedule 1 (table item 2)

Omit “ASIC” (first occurring), substitute “ * ASIC”.

24  Subsection 355-65(4) in Schedule 1 (table items 3 and 4)

Omit “ASIC”, substitute “ * ASIC”.

Note:       This Division commences only if the Foreign Acquisitions and Takeovers Legislation Amendment Act 2015 has not already received the Royal Assent.

Division 2—Amendments if the Foreign Acquisitions and Takeovers Legislation Amendment Act 2015 commences

Taxation Administration Act 1953

25  Subsection 355-65(4) in Schedule 1 (table item 1)

Omit “the Australian Securities and Investments Commission”, substitute “ * ASIC”.

26  Subsection 355-65(4) in Schedule 1 (table item 1)

Omit “the Commission”, substitute “ASIC”.

Note:       This Division commences only if Schedule 4 to the Foreign Acquisitions and Takeovers Legislation Amendment Act 2015 commences.

Part 4 Application of amendments

27  Application of amendments

(1)       Subdivision 396-B in Schedule 1 to the Taxation Administration Act 1953 (as inserted by this Schedule) applies in relation to transactions entered into on or after:

                     (a)  if table item 3 or 4 in section 396-55 in that Schedule (as inserted by this Schedule) describes the transaction—1 July 2016; or

                     (b)  otherwise—1 July 2017.

(2)       However, subparagraphs 396-55(a)(ii) and (b)(ii) in Schedule 1 to the Taxation Administration Act 1953 (as inserted by this Schedule) apply in relation to transactions entered into on or after:

                     (a)  if table item 3 or 4 in section 396-55 in that Schedule (as inserted by this Schedule) describes the transaction—1 July 2016; or

                     (b)  otherwise—1 July 2020.