2008-2009 The Parliament of the Commonwealth of Australia HOUSE OF REPRESENTATIVES Presented and read a first time Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 (Treasury) A Bill for an Act to amend the law relating to taxation, and for related purposes B09BU203.v02.docx 28/4/2009 5:01 PM [Page Break] 1 Short title ............................................................................................ 1 2 Commencement .................................................................................. 1 3 Schedule(s) ......................................................................................... 2 Schedule 1--Reduction in 2009-10 PAYG instalments 3 Part 1--Main amendments 3 Taxation Administration Act 1953 3 Part 2--Sunsetting on 1 July 2014 4 Taxation Administration Act 1953 4 Part 3--Application provision 5 Schedule 2--Choosing annual PAYG instalme nts if voluntarily registered for GST 6 Income Tax Assessment Act 1997 6 Taxation Administration Act 1953 6 Schedule 3--Petroleum resource rent tax 9 Part 1--Functional currency 9 Petroleum Resource Rent Tax Assessment Act 1987 9 Part 2--Exploration expenditure etc. 31 Petroleum Resource Rent Tax Assessment Act 1987 31 Part 3--Processing of internal petroleum 35 Petroleum Resource Rent Tax Assessment Act 1987 35 Part 4--Designated frontier areas 38 Petroleum Resource Rent Tax Assessment Act 1987 38 Schedule 4--Deductible gift recipients 39 Income Tax Assessment Act 1997 39 i Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 B09BU203.v02.docx 28/4/2009 5:01 PM [Page Break] 2 taxation, and for related purposes 3 The Parliament of Australia enacts: 4 1 Short title 5 This Act may be cited as the Tax Laws Amendment (2009 6 Measures No. 3) Act 2009. 7 2 Commence ment 8 (1) Each provision of this Act specified in column 1 of the table 9 commences, or is taken to have commenced, in accordance with 10 column 2 of the table. Any other statement in column 2 has effect 11 according to its terms. 12 Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 1 [Page Break] Column 1 Column 2 Column 3 Provision(s) Commencement Date/Details 1. Sections 1 to 3 The day on which this Act receives the and anything in Royal Assent. this Act not elsewhere covered by this table 2. Schedule 1, The day after this Act receives the Royal Part 1 Assent. 3. Schedule 1, 1 Ju ly 2014. 1 Ju ly 2014 Part 2 4. Schedule 1, The day after this Act receives the Royal Part 3 Assent. 5. Schedule 2 The day on which this Act receives the Royal Assent. 6. Schedule 3, 1 Ju ly 2009. 1 Ju ly 2009 Part 1 7. Schedule 3, 1 Ju ly 2008. 1 Ju ly 2008 Parts 2 and 3 8. Schedule 3, 12 May 2009. 12 May 2009 Part 4 9. Schedule 4 The day on which this Act receives the Royal Assent. 1 Note: This table relates only to the provisions of this Act as originally 2 passed by both Houses of the Parliament and assented to. It will not be 3 expanded to deal with provisions inserted in this Act after assent. 4 (2) Column 3 of the table contains additional information that is not 5 part of this Act. Information in this column may be added to or 6 edited in any published version of this Act. 7 3 Schedule(s) 8 Each Act that is specified in a Schedule to this Act is amended or 9 repealed as set out in the applicable items in the Schedule 10 concerned, and any other item in a Schedule to this Act has effect 11 according to its terms. 12 2 Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 [Page Break] Main amendments Part 1 1 Schedule 1--Reduction in 2009-10 PAYG 2 instalments 3 Part 1--Main amendments 4 Taxation Administration Act 1953 5 1 Subsection 45-405(3) in Schedule 1 (definition of GDP 6 adjustment) 7 Repeal the definition, substitute: 8 GDP adjustment means: 9 (a) if the current year is the 2009-10 income year--2%; or 10 (b) otherwise: 11 (i) the percentage (rounded to the nearest whole number, 12 rounding down a number ending in .5) worked out using 13 the following formula; or 14 (ii) if the percentage worked out using the formula is 15 negative--0%: Sum of GDP amounts current year 100 100 Sum of GDP amounts previous year 16 17 Note: Paragraph (a) will be repealed on 1 July 2014: see Part 2 of 18 Schedule 1 to the Tax Laws Amendment (2009 Measures No. 3) Act 19 2009. 20 2 Subsection 45-405(6) in Schedule 1 21 Omit "The GDP adjustment", substitute "In a case covered by 22 paragraph (b) of the definition of GDP adjustment in subsection (3), the 23 GDP adjustment". 24 Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 3 [Page Break] Part 2 Sunsetting on 1 July 2014 1 Part 2--Sunsetting on 1 July 2014 2 Taxation Administration Act 1953 3 3 Subsection 45-405(3) in Schedule 1 (paragraphs (a) and (b) 4 of the definition of GDP adjustment) 5 Repeal the paragraphs (not including the formula), substitute: 6 (a) the percentage (rounded to the nearest whole number, 7 rounding down a number ending in .5) worked out using the 8 following formula; or 9 (b) if the percentage worked out using the formula is negative-- 10 0%: 11 4 Subsection 45-405(3) in Schedule 1 (note to the definition 12 of GDP adjustment) 13 Repeal the note. 14 5 Subsection 45-405(6) in Schedule 1 15 Omit "In a case covered by paragraph (b) of the definition of GDP 16 adjustment in subsection (3), the", substitute "The". 17 4 Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 [Page Break] Application provision Part 3 1 Part 3--Application provision 2 6 Application of Part 1 amendments 3 The amendments made by Part 1 of this Schedule apply for the purposes 4 of working out the amount of an instalment that becomes due on or after 5 the commencement of this item. 6 Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 5 [Page Break] 1 Schedule 2--Choosing annual PAYG 2 instalments if voluntarily registered for 3 GST 4 5 Income Tax Assessment Act 1997 6 1 Subsection 995-1(1) 7 Insert: 8 annual tax period election has the same meaning as in the A New 9 Tax System (Goods and Services Tax) Act 1999. 10 Taxation Administration Act 1953 11 2 Section 45-1 in Schedule 1 12 Omit "If you are not registered for GST purposes,", substitute "If you 13 are not required to be registered for GST purposes,". 14 3 After subsection 45-140(1) in Schedule 1 15 Insert: 16 (1A) You may also choose at a time (subject to subsection (2)) to pay 17 instalments annually instead of quarterly if at that time either: 18 (a) an *annual tax period election of yours has effect and, if you 19 are a partner in one or more partnerships that are registered 20 under Part 2-5 of the * GST Act, an annual tax period election 21 of each of those partnerships has effect; or 22 (b) all of the following subparagraphs apply: 23 (i) you are neither registered, nor * required to be registered, 24 under Part 2-5 of the GST Act; 25 (ii) you are a partner in one or more partnerships that are 26 registered under that Part; 27 (iii) an annual tax period election of each of those 28 partnerships has effect; 29 and at the end of the * starting instalment quarter, you satisfy the 30 following conditions: 31 (c) you are not a partner in a partnership that is required to be 32 registered under Part 2-5 of the GST Act; 6 Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 [Page Break] 1 (d) your most recent * notional tax notified by the Commissioner 2 is less than $8,000; 3 (e) in the case of a company--the company is not a * participant 4 in a * GST joint venture under Division 51 of that Act; 5 (f) in the case of a company--the company is not part of an 6 * instalment group. 7 Note: You cannot choose to be an annual payer while you are the head 8 company of a consolidated group to which Subdivision 45-Q applies: 9 see section 45-720. 10 4 Subsection 45-140(2) in Schedule 1 11 After "choice", insert "under subsection (1) or (1A)". 12 5 Paragraph 45-140(3)(a) in Schedule 1 13 After "subsection (1)", insert "or (1A)". 14 6 Paragraph 45-150(1)(a) in Schedule 1 15 Omit "* registered, or * required to be registered,", substitute "* required 16 to be registered". 17 7 Paragraphs 45-150(1)(b) and (c) in Schedule 1 18 Omit "registered, or required to be registered,", substitute "required to 19 be registered". 20 8 At the end of subsection 45-150(1) in Schedule 1 21 Add: 22 ; or (f) an *annual tax period election of yours, or of a partnership in 23 which you are a partner, ceases to have effect. 24 9 Paragraph 45-150(3)(a) in Schedule 1 25 Repeal the paragraph, substitute: 26 (a) after you stop being an * annual payer under subsection (1), 27 you satisfy the conditions in subsection 45-140(1) or (1A); 28 and 29 10 Paragraph 45-150(3)(b) in Schedule 1 30 Omit "that section", substitute "section 45-140". 31 11 Paragraph 45-155(4)(a) in Schedule 1 Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 7 [Page Break] 1 Omit "again satisfy the conditions in section 45-140", substitute "satisfy 2 the conditions in subsection 45-140(1) or in paragraphs 45-140(1A)(c), 3 (d), (e) and (f)". 4 12 Paragraph 45-155(4)(b) in Schedule 1 5 Omit "that section", substitute "section 45-140". 6 13 Paragraph 45-160(3)(a) in Schedule 1 7 Repeal the paragraph, substitute: 8 (a) after you stop being an * annual payer under subsection (1), 9 you satisfy the conditions in subsection 45-140(1) or (1A); 10 and 11 14 Paragraph 45-160(3)(b) in Schedule 1 12 Omit "that section", substitute "section 45-140". 13 15 Application 14 The amendments of the Taxation Administration Act 1953 made by this 15 Schedule apply in relation to instalments for income years starting after 16 30 June 2009. 17 8 Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 [Page Break] Functional currency Part 1 1 Schedule 3--Petroleum resource rent tax 2 Part 1--Functional currency 3 Petroleum Resource Rent Tax Assessment Act 1987 4 1 Section 2 5 Insert: 6 accounts includes: 7 (a) ledgers; and 8 (b) journals; and 9 (c) statements of financial performance; and 10 (d) profit and loss accounts; and 11 (e) balance-sheets; and 12 (f) statements of financial position; 13 and also includes statements, reports and notes attached to, or 14 intended to be read with, anything covered by any of the above 15 paragraphs. 16 2 Section 2 17 Insert: 18 applicable foreign currency has the meaning given by 19 section 58C. 20 3 Section 2 21 Insert: 22 basic company group has the meaning given by section 2B. 23 4 Section 2 24 Insert: 25 designated company group has the meaning given by section 2BA. 26 5 Section 2 27 Insert: Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 9 [Page Break] Part 1 Functional currency 1 excess closing-down expenditure has the meaning given by 2 paragraph 46(1)(a). 3 6 Section 2 4 Insert: 5 foreign currency means a currency other than Australian currency. 6 7 Section 2 7 Insert: 8 group company has the meaning given by section 2B. 9 8 Section 2 10 Insert: 11 head company of a designated company group has the meaning 12 given by section 2BA. 13 9 Section 2 14 Insert: 15 overall company group has the meaning given by section 2B. 16 10 Section 2 17 Insert: 18 subsidiary has the meaning given by section 2B. 19 11 Subsection 2B(1) 20 Before "during so much", insert "at all times". 21 Note 1: The heading to section 2B is altered by adding at the end ", subsidiaries, basic 22 company groups and overall company groups". 23 Note 2: The following heading to subsection 2B(1) is inserted "Group company--period". 24 12 After subsection 2B(1) 25 Insert: 10 Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 [Page Break] Functional currency Part 1 1 Group company--time 2 (1A) For the purposes of this Act, a company is a group company in 3 relation to another company at a particular time if, at that time: 4 (a) one of the companies was a subsidiary of the other company; 5 or 6 (b) each of the companies was a subsidiary of the same 7 company. 8 13 Subsection 2B(2) 9 Repeal the subsection, substitute: 10 Subsidiary 11 (2) For the purposes of this Act, a company (in this subsection called 12 the subsidiary company) is a subsidiary of another company (in 13 this subsection called the holding company) at a particular time if, 14 at that time: 15 (a) all the shares in the subsidiary company are beneficially 16 owned by: 17 (i) the holding company; or 18 (ii) a company that is, or 2 or more companies each of 19 which is, a subsidiary of the holding company; or 20 (iii) the holding company and a company that is, or 2 or 21 more companies each of which is, a subsidiary of the 22 holding company; and 23 (b) there is no agreement, arrangement or understanding in force 24 under which any person is able, or would be able after that 25 time, to affect rights of the holding company or of a 26 subsidiary of the holding company in relation to the 27 subsidiary company. 28 14 Subsection 2B(3) 29 Omit "this section", substitute "this Act". 30 15 After subsection 2B(4) 31 Insert: Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 11 [Page Break] Part 1 Functional currency 1 Basic company group 2 (4A) For the purposes of this Act, a basic company group is a group of 3 companies, where each company in the group is a group company 4 in relation to each other company in the group. 5 Overall company group 6 (4B) For the purposes of this Act, an overall company group is a basic 7 company group that is not a subset of any other basic company 8 group. 9 Note: The following heading to subsection 2B(5) is inserted "When company in existence". 10 16 After section 2B 11 Insert: 12 2BA Designated company groups 13 (1) This section sets out the method for identifying a designated 14 company group for the purposes of this Act. 15 (2) First, identify a particular overall company group. 16 (3) Second, identify all of the members of the overall company group 17 that are entitled to derive assessable receipts in relation to a 18 petroleum project (whether or not the same petroleum project). 19 These members constitute a provisional designated company 20 group. 21 (4) Third, if the following conditions are satisfied in relation to a 22 company (the key company): 23 (a) the key company is a member of the provisional designated 24 company group; 25 (b) the key company is not a subsidiary of any other company in 26 the provisional designated company group; 27 (c) each other company in the provisional designated company 28 group is a subsidiary of the key company; 29 then: 30 (d) the provisional designated company group is a designated 31 company group; and 32 (e) the key company is the head company of that designated 33 company group. 12 Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 [Page Break] Functional currency Part 1 1 (5) Fourth, if: 2 (a) subsection (4) does not apply; and 3 (b) each company in the provisional designated company group 4 is a subsidiary of another company (the key company) that: 5 (i) is a member of the overall company group; and 6 (ii) is not a member of the provisional designated company 7 group; 8 then: 9 (c) both: 10 (i) the key company; and 11 (ii) the members of the provisional designated company 12 group; 13 constitute a designated company group; and 14 (d) the key company is the head company of that designated 15 company group. 16 (6) Subsection (5) has effect subject to subsection (7). 17 (7) If: 18 (a) a designated company group is covered by subsection (5); 19 and 20 (b) the head company of the designated company group is a 21 subsidiary of another company (the higher-tier company); 22 and 23 (c) the higher-tier company is a member of the overall company 24 group; and 25 (d) the higher-tier company is not a member of the provisional 26 designated company group; 27 there is taken not to be a designated company group of which: 28 (e) the higher-tier company is the head company; and 29 (f) any member of the provisional designated company group is 30 a member. 31 17 Section 10 32 Repeal the section, substitute: 33 10 Translation of amounts into Australian currency 34 (1) For the purposes of this Act, an amount in a foreign currency is to 35 be translated into Australian currency. Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 13 [Page Break] Part 1 Functional currency 1 Examples of an amount 2 (2) The following are examples of an amount: 3 (a) an amount of an expense; 4 (b) an amount of an obligation; 5 (c) an amount of a liability; 6 (d) an amount of a receipt; 7 (e) an amount of a payment; 8 (f) an amount of consideration; 9 (g) a value. 10 Translation rule--assessable receipt 11 (3) If: 12 (a) a person derives an assessable receipt in relation to a 13 petroleum project; and 14 (b) the receipt is in a foreign currency; 15 the receipt is to be translated into Australian currency at the 16 exchange rate applicable at the time when the receipt is derived. 17 Translation rule--deductible expenditure 18 (4) If: 19 (a) a person incurs deductible expenditure in relation to a 20 petroleum project; and 21 (b) the expenditure is in a foreign currency; 22 the expenditure is to be translated into Australian currency at the 23 exchange rate applicable at the time when the expenditure is 24 incurred. 25 Translation rule--transfer of entire entitlement to assessable 26 receipts 27 (5) If: 28 (a) section 48 applies in relation to a transaction; and 29 (b) a person is a purchaser (within the meaning of section 48) in 30 relation to the transaction; and 31 (c) the person is taken, under section 48, to have derived or 32 incurred an amount; and 14 Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 [Page Break] Functional currency Part 1 1 (d) the vendor (within the meaning of section 48) in relation to 2 the transaction has made an election under section 58B 3 (functional currency); and 4 (e) the election is in effect for the year of tax in which the 5 transfer time (within the meaning of section 48) occurred; 6 and 7 (f) the amount is in the vendor's applicable functional currency; 8 the amount is to be translated from the applicable functional 9 currency into Australian currency at the exchange rate applicable at 10 the transfer time (within the meaning of section 48). 11 Translation rule--transfer of part of entitlement to assessable 12 receipts 13 (6) If: 14 (a) section 48A applies in relation to a transaction; and 15 (b) a person is a purchaser (within the meaning of section 48A) 16 in relation to the transaction; and 17 (c) the person is taken, under section 48A, to have derived or 18 incurred an amount; and 19 (d) the vendor (within the meaning of section 48A) in relation to 20 the transaction has made an election under section 58B 21 (functional currency); and 22 (e) the election is in effect for the year of tax in which the 23 transfer time (within the meaning of section 48A) occurred; 24 and 25 (f) the amount is in the vendor's applicable functional currency; 26 the amount is to be translated from the applicable functional 27 currency into Australian currency at the exchange rate applicable at 28 the transfer time (within the meaning of section 48A). 29 Operation of functional currency provisions unaffected 30 (7) This section does not affect the operation of Division 7 of Part V 31 (functional currency). 32 18 Subsection 46(1) 33 Repeal the subsection, substitute: 34 (1) If, in relation to a petroleum project, the sum of any closing-down 35 expenditure and any other deductible expenditure incurred by a Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 15 [Page Break] Part 1 Functional currency 1 person in a year of tax exceeds the assessable receipts derived by 2 the person in the year of tax: 3 (a) so much of the excess as does not exceed the amount of the 4 closing-down expenditure is the person's excess 5 closing-down expenditure for the year of tax; and 6 (b) the person is entitled to a credit of the lesser of the following 7 amounts: 8 (i) an amount equal to 40% of the excess closing-down 9 expenditure for the year of tax; 10 (ii) the total amount of any tax in respect of the project 11 (including in the case of a combined project any 12 pre-combination project in relation to the project) paid 13 or payable by the person in relation to previous years of 14 tax, reduced by the total amount of any credits allowed 15 or allowable to the person under this section in relation 16 to the project in relation to any previous years of tax. 17 19 At the end of Part V 18 Add: 19 Division 7--Functional currency 20 58A Objects of this Division 21 The objects of this Division are: 22 (a) to allow a person whose accounts are kept solely or 23 predominantly in a particular foreign currency (the 24 functional currency) to calculate: 25 (i) the person's taxable profits; and 26 (ii) certain other amounts; 27 by reference to the functional currency; and 28 (b) to allow companies that: 29 (i) are in a designated company group; and 30 (ii) whose accounts are kept solely or predominantly in a 31 particular foreign currency (the functional currency); 32 to calculate: 33 (iii) their taxable profits; and 34 (iv) certain other amounts; 35 by reference to the functional currency. 16 Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 [Page Break] Functional currency Part 1 1 58B Person may elect to be bound by the functional currency rules 2 (1) A person may elect to be bound by the functional currency rules 3 for the purposes of this Act, with effect from the start of: 4 (a) if the election was made by the person within 30 days after 5 the day on which the Tax Laws Amendment (2009 Measures 6 No. 3) Act 2009 received the Royal Assent--the year of tax 7 beginning on 1 July 2009; or 8 (b) in any other case--the year of tax following the one in which 9 the person made the election. 10 (2) An election under subsection (1) must be in writing. 11 (3) An election under subsection (1) continues in effect until a 12 withdrawal of the election takes effect (see section 58L). 13 Designated company group--deemed election etc. 14 (4) If: 15 (a) a person has made an election under subsection (1); and 16 (b) at the time when the person made the election, the person 17 was the head company of a designated company group; and 18 (c) the election is in effect for a year of tax; and 19 (d) when the election took effect, the person was the head 20 company of a designated company group; and 21 (e) immediately before the end of the year of tax, the person is 22 the head company of a designated company group (the 23 current designated company group); 24 then: 25 (f) each other company that was in the current designated 26 company group immediately before the end of the year of tax 27 is taken to have made an election under subsection (1); and 28 (g) an election covered by paragraph (f): 29 (i) is taken to have been in effect for the year of tax; and 30 (ii) supersedes any previous election made by the other 31 company that was in effect for the year of tax. 32 (5) If: 33 (a) a person has made an election under subsection (1); and 34 (b) at the time when the person made the election, the person 35 was the head company of a designated company group; and Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 17 [Page Break] Part 1 Functional currency 1 (c) the election is in effect for a year of tax; and 2 (d) during the year of tax, the person ceased to be the head 3 company of the designated company group; and 4 (e) immediately before the end of the year of tax, another 5 company is the head company of the designated company 6 group; 7 then: 8 (f) the company covered by paragraph (e) is taken to have made 9 an election under subsection (1); and 10 (g) an election covered by paragraph (f): 11 (i) is taken to have been in effect for the year of tax; and 12 (ii) supersedes any previous election made by the company 13 that was in effect for the year of tax; and 14 (h) each other company that was in the designated company 15 group immediately before the end of the year of tax is taken 16 to have made an election under subsection (1); and 17 (i) an election covered by paragraph (h): 18 (i) is taken to have been in effect for the year of tax; and 19 (ii) supersedes any previous election made by the other 20 company that was in effect for the year of tax. 21 (6) If: 22 (a) immediately before the end of a year of tax, a person is the 23 head company of a designated company group; and 24 (b) the person is not taken, under subsection (5), to have made an 25 election under subsection (1) that is in effect for the year of 26 tax; and 27 (c) the person has not made an election under subsection (1) that: 28 (i) is in effect for the year of tax; and 29 (ii) under subsection (4), results in each other company that 30 was in the designated company group immediately 31 before the end of the year of tax being taken to have 32 made an election under subsection (1); and 33 (d) a company that was in the designated company group 34 immediately before the end of the year of tax has made an 35 election under subsection (1); and 36 (e) the election covered by paragraph (d) is in effect for the year 37 of tax; 18 Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 [Page Break] Functional currency Part 1 1 the company covered by paragraph (d) is taken to have withdrawn 2 the election covered by paragraph (d) with effect from the start of 3 the year of tax. 4 58C Applicable foreign curre ncy 5 (1) For the purposes of this Act, if: 6 (a) a person has made an election under section 58B (other than 7 an election taken to have been made as a result of the 8 application of subsection 58B(4) or paragraph 58B(5)(h) to a 9 designated company group); and 10 (b) the election is in effect for a year of tax; 11 the person's applicable functional currency for the year of tax is 12 the sole or predominant foreign currency in which: 13 (c) if the person is the head company of a designated company 14 group--the person kept the person's accounts immediately 15 before the end of the year of tax; or 16 (d) otherwise--the person kept the person's accounts at the time 17 when the person made the election. 18 Designated company group 19 (2) For the purposes of this Act, if: 20 (a) a person is taken to have made an election under section 58B 21 as a result of the application of subsection 58B(4) or 22 paragraph 58B(5)(h) to a designated company group; and 23 (b) the election is in effect for a year of tax; 24 the person's applicable functional currency for the year of tax is 25 the sole or predominant currency in which the head company of the 26 designated company group kept its accounts immediately before 27 the end of the year of tax. 28 58D Basic translation rules 29 (1) If: 30 (a) a person has made an election under section 58B; and 31 (b) that election is in effect for a year of tax; 32 the following rules apply: 33 (c) first, for the purpose of working out the taxable profit of the 34 person of the year of tax in relation to a petroleum project: Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 19 [Page Break] Part 1 Functional currency 1 (i) an amount that is not in the applicable functional 2 currency is to be translated into the applicable 3 functional currency; and 4 (ii) the definition of foreign currency in section 2 does not 5 apply; and 6 (iii) the applicable functional currency is taken not to be a 7 foreign currency; and 8 (iv) Australian currency and any other currency (except the 9 applicable functional currency) are taken to be foreign 10 currencies; 11 (d) second, the taxable profit of the person of the year of tax in 12 relation to the petroleum project is to be translated into 13 Australian currency; 14 (e) third, for the purpose of working out a credit to which the 15 person is entitled under section 46 in relation to the year of 16 tax, an amount of excess closing-down expenditure is to be 17 translated into Australian currency. 18 Examples of an amount 19 (2) The following are examples of an amount: 20 (a) an amount of an expense; 21 (b) an amount of an obligation; 22 (c) an amount of a liability; 23 (d) an amount of a receipt; 24 (e) an amount of a payment; 25 (f) an amount of consideration; 26 (g) a value. 27 58E Translation rule--assessable receipt 28 If: 29 (a) a person derives an assessable receipt in relation to a 30 petroleum project; and 31 (b) the receipt is not in the applicable functional currency; and 32 (c) the receipt was derived when an election made by the person 33 under section 58B was in effect; 34 the receipt is to be translated into the applicable functional 35 currency at the exchange rate applicable at the time when the 36 receipt was derived. 20 Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 [Page Break] Functional currency Part 1 1 58F Translation rule--deductible expenditure 2 If: 3 (a) a person incurs deductible expenditure in relation to a 4 petroleum project; and 5 (b) the expenditure is not in the applicable functional currency; 6 and 7 (c) the expenditure was incurred when an election made by the 8 person under section 58B was in effect; 9 the expenditure is to be translated into the applicable functional 10 currency at the exchange rate applicable at the time the expenditure 11 was incurred. 12 58G Translation rule--transfer of entire entitle ment to assessable 13 receipts 14 If: 15 (a) section 48 applies in relation to a transaction; and 16 (b) a person is a purchaser (within the meaning of section 48) in 17 relation to the transaction; and 18 (c) the person is taken, under section 48, to have derived or 19 incurred an amount; and 20 (d) the transfer time (within the meaning of section 48) occurred 21 when an election made by the person under section 58B was 22 in effect; and 23 (e) the amount is not in the applicable functional currency; 24 the amount is to be translated into the applicable functional 25 currency at the exchange rate applicable at the transfer time (within 26 the meaning of section 48). 27 58H Translation rule--transfer of part of entitlement to assessable 28 receipts 29 If: 30 (a) section 48A applies in relation to a transaction; and 31 (b) a person is a purchaser (within the meaning of section 48A) 32 in relation to the transaction; and 33 (c) the person is taken, under section 48A, to have derived or 34 incurred an amount; and Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 21 [Page Break] Part 1 Functional currency 1 (d) the transfer time (within the meaning of section 48A) 2 occurred when an election made by the person under 3 section 58B was in effect; and 4 (e) the amount is not in the applicable functional currency; 5 the amount is to be translated into the applicable functional 6 currency at the exchange rate applicable at the transfer time (within 7 the meaning of section 48A). 8 58J Translation of taxable profit, or excess closing-down 9 expenditure, into Australian curre ncy 10 (1) If: 11 (a) paragraph 58D(1)(d) requires the translation of the taxable 12 profit of a person of a year of tax in relation to a petroleum 13 project; or 14 (b) paragraph 58D(1)(e) requires the translation of an amount of 15 excess closing-down expenditure for the purpose of working 16 out a credit to which a person is entitled under section 46 in 17 relation to a year of tax; 18 that taxable profit or excess closing-down expenditure, as the case 19 may be, is to be translated using: 20 (c) if the person elects to use an exchange rate that is an average 21 of all the exchange rates during the year of tax--that 22 exchange rate; or 23 (d) if the person elects to use the exchange rate applicable on the 24 last day of the year of tax--that exchange rate. 25 (2) An election under paragraph (1)(c) or (d): 26 (a) must be in writing; and 27 (b) is irrevocable. 28 Default election 29 (3) If: 30 (a) either: 31 (i) paragraph 58D(1)(d) requires the translation of the 32 taxable profit of a person of a year of tax in relation to a 33 petroleum project; or 34 (ii) paragraph 58D(1)(e) requires the translation of an 35 amount of excess closing-down expenditure for the 22 Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 [Page Break] Functional currency Part 1 1 purpose of working out a credit to which a person is 2 entitled under section 46 in relation to a year of tax; and 3 (b) the person does not make an election under paragraph (1)(c) 4 or (d) of this section in relation to the year of tax; 5 the person is taken to have made an election under paragraph (1)(c) 6 of this section in relation to the year of tax. 7 Continuity of election 8 (4) If: 9 (a) a person has made an election under section 58B; and 10 (b) that election is in effect for 2 or more consecutive years of 11 tax; and 12 (c) the person made an election under paragraph (1)(c) of this 13 section in relation to the first of those years of tax; 14 the person is taken to have made an election under paragraph (1)(c) 15 of this section in relation to each remaining year of tax. 16 (5) If: 17 (a) a person has made an election under section 58B; and 18 (b) that election is in effect for 2 or more consecutive years of 19 tax; and 20 (c) the person made an election under paragraph (1)(d) of this 21 section in relation to the first of those years of tax; 22 the person is taken to have made an election under paragraph (1)(d) 23 of this section in relation to each remaining year of tax. 24 Designated company group--deemed election under 25 paragraph (1)(c) etc. 26 (6) If: 27 (a) a person has made an election under paragraph (1)(c) in 28 relation to a year of tax; and 29 (b) at the time when the person made the election, the person 30 was the head company of a designated company group; and 31 (c) immediately before the end of the year of tax, the person is 32 the head company of a designated company group (the 33 current designated company group); 34 then: Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 23 [Page Break] Part 1 Functional currency 1 (d) each other company that was in the current designated 2 company group immediately before the end of the year of tax 3 is taken to have made an election under paragraph (1)(c) in 4 relation to the year of tax; and 5 (e) an election covered by paragraph (d): 6 (i) is taken to have been in effect for the year of tax; and 7 (ii) supersedes any previous election made by the other 8 company that was in effect for the year of tax. 9 (7) If: 10 (a) a person has made an election under paragraph (1)(c); and 11 (b) at the time when the person made the election, the person 12 was the head company of a designated company group; and 13 (c) the election is in effect for a year of tax; and 14 (d) during the year of tax, the person ceased to be the head 15 company of the designated company group; and 16 (e) immediately before the end of the year of tax, another 17 company is the head company of the designated company 18 group; 19 then: 20 (f) the company covered by paragraph (e) of this subsection is 21 taken to have made an election under paragraph (1)(c); and 22 (g) an election covered by paragraph (f) of this subsection: 23 (i) is taken to have been in effect for the year of tax; and 24 (ii) supersedes any previous election made by the company 25 that was in effect for the year of tax; and 26 (h) each other company that was in the designated company 27 group immediately before the end of the year of tax is taken 28 to have made an election under paragraph (1)(c); and 29 (i) an election covered by paragraph (h) of this subsection: 30 (i) is taken to have been in effect for the year of tax; and 31 (ii) supersedes any previous election made by the other 32 company that was in effect for the year of tax. 33 (8) If: 34 (a) immediately before the end of a year of tax, a person is the 35 head company of a designated company group; and 24 Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 [Page Break] Functional currency Part 1 1 (b) the person is not taken, under subsection (7), to have made an 2 election under paragraph (1)(c) that is in effect for the year of 3 tax; and 4 (c) the person has not made an election under paragraph (1)(c) 5 that: 6 (i) relates to the year of tax; and 7 (ii) under subsection (6), results in each other company that 8 was in the designated company group immediately 9 before the end of the year of tax being taken to have 10 made an election under paragraph (1)(c); and 11 (d) a company that was in the designated company group 12 immediately before the end of the year of tax has made an 13 election under paragraph (1)(c) in relation to the year of tax; 14 the election covered by paragraph (c) of this subsection is taken not 15 to have been in effect for the year of tax. 16 Designated company group--deemed election under 17 paragraph (1)(d) etc. 18 (9) If: 19 (a) a person has made an election under paragraph (1)(d) in 20 relation to a year of tax; and 21 (b) at the time when the person made the election, the person 22 was the head company of a designated company group; and 23 (c) immediately before the end of the year of tax, the person is 24 the head company of a designated company group (the 25 current designated company group); 26 then: 27 (d) each other company that was in the current designated 28 company group immediately before the end of the year of tax 29 is taken to have made an election under paragraph (1)(d) in 30 relation to the year of tax; and 31 (e) an election covered by paragraph (d): 32 (i) is taken to have been in effect for the year of tax; and 33 (ii) supersedes any previous election made by the other 34 company that was in effect for the year of tax. 35 (10) If: 36 (a) a person has made an election under paragraph (1)(d); and Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 25 [Page Break] Part 1 Functional currency 1 (b) at the time when the person made the election, the person 2 was the head company of a designated company group; and 3 (c) the election is in effect for a year of tax; and 4 (d) during the year of tax, the person ceased to be the head 5 company of the designated company group; and 6 (e) immediately before the end of the year of tax, another 7 company is the head company of the designated company 8 group; 9 then: 10 (f) the company covered by paragraph (e) of this subsection is 11 taken to have made an election under paragraph (1)(d); and 12 (g) an election covered by paragraph (f) of this subsection: 13 (i) is taken to have been in effect for the year of tax; and 14 (ii) supersedes any previous election made by the company 15 that was in effect for the year of tax; and 16 (h) each other company that was in the designated company 17 group immediately before the end of the year of tax is taken 18 to have made an election under paragraph (1)(d); and 19 (i) an election covered by paragraph (h) of this subsection: 20 (i) is taken to have been in effect for the year of tax; and 21 (ii) supersedes any previous election made by the other 22 company that was in effect for the year of tax. 23 (11) If: 24 (a) immediately before the end of a year of tax, a person is the 25 head company of a designated company group; and 26 (b) the person is not taken, under subsection (10), to have made 27 an election under paragraph (1)(d) that is in effect for the 28 year of tax; and 29 (c) the person has not made an election under paragraph (1)(d) 30 that: 31 (i) relates to the year of tax; and 32 (ii) under subsection (9), results in each other company that 33 was in the designated company group immediately 34 before the end of the year of tax being taken to have 35 made an election under paragraph (1)(d); and 36 (d) a company that was in the designated company group 37 immediately before the end of the year of tax has made an 38 election under paragraph (1)(d) in relation to the year of tax; 26 Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 [Page Break] Functional currency Part 1 1 the election covered by paragraph (c) of this subsection is taken not 2 to have been in effect for the year of tax. 3 58K Special translation rules--events that happened before the 4 current election took effect 5 Class 1 augmented bond rate general expenditure, class 1 6 augmented bond rate exploration expenditure and class 2 7 augmented bond rate general expenditure 8 (1) If: 9 (a) a person has made an election under section 58B (the current 10 election) with effect from the start of a particular year of tax; 11 and 12 (b) any of the following subparagraphs applies: 13 (i) under subsection 33(3), an amount is taken to be class 1 14 augmented bond rate general expenditure incurred by 15 the person in relation to a petroleum project on the first 16 day of the year of tax; 17 (ii) under subsection 34(3), an amount is taken to be class 1 18 augmented bond rate exploration expenditure incurred 19 by the person in relation to a petroleum project on the 20 first day of the year of tax; 21 (iii) under subsection 34A(4), an amount is taken to be class 22 2 augmented bond rate general expenditure incurred by 23 the person on the first day of the year of tax; and 24 (c) as a result of the current election, section 58D requires that 25 the amount be translated into the applicable functional 26 currency; 27 the amount is to be translated into the applicable functional 28 currency at the exchange rate applicable when the current election 29 took effect. 30 Class 2 augmented bond rate exploration expenditure, class 2 31 GDP factor expenditure and transferable exploration expenditure 32 (2) For the purpose of working out: 33 (a) the class 2 augmented bond rate exploration expenditure; or 34 (b) the class 2 GDP factor expenditure; or 35 (c) the transferable exploration expenditure; Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 27 [Page Break] Part 1 Functional currency 1 that a person is taken to have incurred in a year of tax in relation to 2 a petroleum project, if: 3 (d) the person has made an election (the current election) under 4 section 58B; and 5 (e) the current election is in effect for the year of tax; and 6 (f) section 58D requires that an amount of expenditure be 7 translated into the applicable functional currency; and 8 (g) the expenditure was actually incurred before the current 9 election took effect; 10 the expenditure is to be translated into the applicable functional 11 currency at the exchange rate applicable when the current election 12 took effect. 13 58L Withdrawal of election 14 (1) If: 15 (a) a person has made an election under section 58B (other than 16 an election taken to have been made as a result of the 17 application of subsection 58B(4) or paragraph 58B(5)(h) to a 18 designated company group); and 19 (b) the person's applicable functional currency has ceased to be 20 the sole or predominant currency in which the person keeps 21 the person's accounts; 22 the person may withdraw the election with effect from immediately 23 after the end of the year of tax in which the person withdraws the 24 election. 25 (2) A withdrawal must be in writing. 26 (3) Withdrawing an election does not prevent the person from making 27 a fresh election under section 58B. 28 Designated company groups--deemed withdrawal of election etc 29 (4) If: 30 (a) a person withdraws an election under section 58B with effect 31 from immediately after the end of the year of tax in which the 32 person withdraws the election; and 33 (b) at the time when the withdrawal is made, the person is the 34 head company of a designated company group; 28 Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 [Page Break] Functional currency Part 1 1 each other company in the designated company group is taken to 2 have withdrawn the other company's section 58B election with 3 effect from immediately after the end of the year of tax. 4 58M Special translation rules--events that happened before the 5 withdrawal of an election took effect 6 Class 1 augmented bond rate general expenditure, class 1 7 augmented bond rate exploration expenditure and class 2 8 augmented bond rate general expenditure 9 (1) If: 10 (a) a person withdraws an election under section 58B with effect 11 from immediately after the end of a year of tax; and 12 (b) the person does not make a fresh election under section 58B 13 with effect from the start of the next year of tax; and 14 (c) any of the following subparagraphs applies: 15 (i) under subsection 33(3), an amount is taken to be class 1 16 augmented bond rate general expenditure incurred by 17 the person in relation to a petroleum project on the first 18 day of the next year of tax; 19 (ii) under subsection 34(3), an amount is taken to be class 1 20 augmented bond rate exploration expenditure incurred 21 by the person in relation to a petroleum project on the 22 first day of the next year of tax; 23 (iii) under subsection 34A(4), an amount is taken to be class 24 2 augmented bond rate general expenditure incurred by 25 the person on the first day of the next year of tax; and 26 (d) section 10 requires that the amount be translated into 27 Australian currency; 28 the amount is to be translated into Australian currency at the 29 exchange rate applicable at the start of the next year of tax. 30 Class 2 augmented bond rate exploration expenditure, class 2 31 GDP factor expenditure and transferable exploration expenditure 32 (2) For the purpose of working out: 33 (a) the class 2 augmented bond rate exploration expenditure; or 34 (b) the class 2 GDP factor expenditure; or 35 (c) the transferable exploration expenditure; Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 29 [Page Break] Part 1 Functional currency 1 that a person is taken to have incurred in a year of tax in relation to 2 a petroleum project, if: 3 (d) a person withdraws an election under section 58B with effect 4 from immediately after the end of an earlier year of tax; and 5 (e) the person has not made an election under section 58B with 6 effect from the start of an intervening year of tax; and 7 (f) section 10 requires that an amount of expenditure be 8 translated into Australian currency; and 9 (g) the expenditure was actually incurred before the withdrawal 10 of the election took effect; 11 the expenditure is to be translated into Australian currency at the 12 exchange rate applicable at the start of the next year of tax after 13 that earlier year of tax. 14 20 Application of amendments 15 The amendments made by this Part apply in relation to instalments and 16 assessments of tax under the Petroleum Resource Rent Tax Assessment 17 Act 1987 for years of tax that start on or after 1 July 2009. 18 30 Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 [Page Break] Exp lorat ion expenditure etc. Part 2 1 Part 2--Exploration expenditure etc. 2 Petroleum Resource Rent Tax Assessment Act 1987 3 21 Section 2 4 Insert: 5 post-30 June 2008 petroleum project means a petroleum project, 6 where the production licence, or each production licence, in 7 relation to the project came into force after 30 June 2008. 8 22 Section 2 9 Insert: 10 pre-1 July 2008 petroleum project means a petroleum project 11 other than a post-30 June 2008 petroleum project. 12 23 Subsection 5(1) 13 Omit "this Act (including this section)", substitute "the application of 14 this Act (including this section) to a pre-1 July 2008 petroleum 15 project,". 16 Note: The following heading to subsection 5(1) is inserted "Pre-1 July 2008 petroleum 17 project". 18 24 Subsection 5(2) 19 Omit "this Act,", substitute "the application of this Act to a pre-1 July 20 2008 petroleum project,". 21 25 At the end of section 5 22 Add: 23 Post-30 June 2008 petroleum project 24 (5) For the purposes of the application of this Act (including this 25 section) to a post-30 June 2008 petroleum project, a reference to 26 exploration for petroleum in, or recovery of petroleum from, a 27 production licence area, an exploration permit area or a retention 28 lease area is a reference to exploration for petroleum in, or 29 recovery of petroleum from, the production licence area, the 30 exploration permit area or the retention lease area while the Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 31 [Page Break] Part 2 Exp loration expenditure etc. 1 production licence, exploration permit or retention lease concerned 2 is or was in force. 3 (6) For the purposes of the application of this Act to a post-30 June 4 2008 petroleum project, a reference to exploration for petroleum 5 in, or recovery of petroleum from, the eligible exploration or 6 recovery area in relation to a petroleum project is a reference to: 7 (a) if the production licence, or any production licence, in 8 relation to the project is a production licence (in this 9 paragraph called the current production licence) derived 10 from an exploration permit (in this paragraph called the prior 11 exploration permit)--exploration for petroleum in, or 12 recovery of petroleum from, the exploration permit area of 13 the prior exploration permit, where the exploration or 14 recovery occurred: 15 (i) before the current production licence came into force; 16 and 17 (ii) if, before the current production licence came into force, 18 there came into force one or more retention leases, or 19 one or more other production licences, derived from the 20 prior exploration permit--after whichever of those 21 retention leases or other production licences last came 22 into force before the current production licence came 23 into force; and 24 (b) if the production licence, or any production licence, in 25 relation to the project is a production licence (in this 26 paragraph called the current production licence) derived 27 from a retention lease (in this paragraph called the prior 28 retention lease)--exploration for petroleum in, or recovery 29 of petroleum from, the retention lease area of the prior 30 retention lease, where the exploration or recovery occurred 31 before the current production licence came into force; and 32 (c) if: 33 (i) the production licence, or any production licence, in 34 relation to the project is a production licence (in this 35 paragraph called the current production licence) 36 derived from a retention lease (in this paragraph called 37 the prior retention lease); and 38 (ii) the prior retention lease was derived from an 39 exploration permit (in this paragraph called the prior 40 exploration permit); 32 Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 [Page Break] Exp lorat ion expenditure etc. Part 2 1 exploration for petroleum in, or recovery of petroleum from, 2 the exploration permit area of the prior exploration permit, 3 where the exploration or recovery occurred: 4 (iii) before the prior retention lease came into force; and 5 (iv) if, before the prior retention lease came into force, there 6 came into force one or more other production licences, 7 or one or more other retention leases, derived from the 8 prior exploration permit--after whichever of those other 9 retention leases or other production licences last came 10 into force before the prior retention lease came into 11 force; and 12 (d) exploration for petroleum in, or recovery of petroleum from, 13 the production licence area of the production licence, or the 14 production licence areas of the production licences, in respect 15 of the project. 16 (7) If: 17 (a) paragraph (6)(c) applies to a post-30 June 2008 petroleum 18 project; and 19 (b) the prior retention lease mentioned in that paragraph is one of 20 a set of 2 or more retention leases that: 21 (i) came into force at the same time; and 22 (ii) were derived from the prior exploration permit 23 mentioned in that paragraph; and 24 (c) the production licence, or the production licences, in relation 25 to one or more other post-30 June 2008 petroleum projects 26 were derived from one or more of the retention leases 27 included in the set mentioned in paragraph (b) of this 28 subsection; and 29 (d) exploration expenditure incurred in relation to the petroleum 30 project mentioned in paragraph (a) of this subsection is 31 attributable to exploration for petroleum in, or recovery of 32 petroleum from, the exploration permit area of the prior 33 exploration permit; 34 then, for the purposes of the application of this Act to the 35 petroleum project mentioned in paragraph (a) of this subsection, 36 the amount of the exploration expenditure mentioned in 37 paragraph (d) of this subsection is taken to be the amount worked 38 out using the following formula: Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 33 [Page Break] Part 2 Exp loration expenditure etc. Number of retention leases relating to the petroleum project mentioned in Unadjusted amount of paragraph (a) of this subsection 1 exploration expentiture Total number of retention leases 2 where: 3 number of retention leases relating to the petroleum project 4 mentioned in paragraph (a) of this subsection means the number 5 of retention leases: 6 (a) from which the production licence, or the production 7 licences, in relation to the petroleum project mentioned in 8 paragraph (a) of this subsection were derived; and 9 (b) that are included in the set mentioned in paragraph (b) of this 10 subsection. 11 total number of retention leases means the number of retention 12 leases that are included in the set mentioned in paragraph (b) of 13 this subsection. 14 unadjusted amount of exploration expenditure means the amount 15 that, apart from this subsection, is the amount of the exploration 16 expenditure mentioned in paragraph (d) of this subsection. 17 34 Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 [Page Break] Processing of internal petroleu m Part 3 1 Part 3--Processing of internal petroleum 2 Petroleum Resource Rent Tax Assessment Act 1987 3 26 Section 2 4 Insert: 5 internal petroleum, in relation to a petroleum project, means 6 petroleum, or constituents of petroleum, recovered from the 7 production licence area or production licence areas in relation to 8 the project, where: 9 (a) the petroleum, or the constituents of petroleum, is, or is to be, 10 recovered or processed: 11 (i) by a person entitled to derive assessable receipts in 12 relation to the project; and 13 (ii) for or on behalf of another person who is entitled to 14 derive assessable receipts in relation to the project; or 15 (b) the petroleum, or the constituents of petroleum, is, or is to be, 16 sold: 17 (i) by a person entitled to derive assessable receipts in 18 relation to the project; and 19 (ii) to another person who is entitled to derive assessable 20 receipts in relation to the project. 21 27 Section 2 (at the end of the definition of petroleum project 22 or project) 23 Add "or (2C)". 24 28 Section 2 25 Insert: 26 processing of internal petroleum, in relation to a petroleum 27 project, includes the stabilisation, transportation, storage or 28 recovery of internal petroleum in relation to the project. 29 29 After subsection 19(2B) 30 Insert: 31 (2C) For the purposes of this Act, there is taken to be included, as part 32 of any petroleum project within the meaning of subsection (1) or Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 35 [Page Break] Part 3 Processing of internal petroleu m 1 (2), the carrying on of any processing of internal petroleum wholly 2 or partly using the operations, facilities and other things 3 comprising the project: 4 (a) in the case of an eligible production licence referred to in 5 subsection (1)--while that licence is in force; or 6 (b) in the case of 2 or more eligible production licences referred 7 to in subsection (2)--while any of those licences are in force. 8 30 Section 24A 9 After "external petroleum", insert ", or internal petroleum,". 10 31 Paragraph 37(1)(c) 11 Repeal the paragraph, substitute: 12 (c) in procuring another person to stabilise, transport, store, 13 recover or process petroleum recovered from the eligible 14 exploration or recovery area (other than any production 15 licence area) in relation to the project, if that stabilisation, 16 transportation, storage, recovery or processing constitutes: 17 (i) the processing of internal petroleum in relation to the 18 project; or 19 (ii) the processing of external petroleum in relation to 20 another petroleum project; 21 32 Paragraph 38(1)(c) 22 After "external petroleum", insert ", or internal petroleum,". 23 33 Paragraph 38(1)(d) 24 Repeal the paragraph, substitute: 25 (d) in procuring another person to stabilise, transport, store, 26 recover or process petroleum recovered from the production 27 licence area or areas in relation to the project, if that 28 stabilisation, transportation, storage, recovery or processing 29 constitutes: 30 (i) the processing of internal petroleum in relation to the 31 project; or 32 (ii) the processing of external petroleum in relation to 33 another petroleum project; 34 34 Subsection 38(2) 36 Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 [Page Break] Processing of internal petroleu m Part 3 1 After "external petroleum", insert ", or internal petroleum,". 2 35 Subsection 41(2) 3 After "external petroleum", insert ", or internal petroleum,". 4 36 Application of amendments 5 The amendments made by this Part apply in relation to instalments and 6 assessments of tax under the Petroleum Resource Rent Tax Assessment 7 Act 1987 for years of tax that start on or after 1 July 2008. 8 Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 37 [Page Break] Part 4 Designated frontier areas 1 Part 4--Designated frontier areas 2 Petroleum Resource Rent Tax Assessment Act 1987 3 37 Subsection 36B(2) 4 Omit "2008", substitute "2009". 5 Note: The heading to section 36B is altered by omitting "2008" and substituting "2009". 6 38 Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 [Page Break] 1 Schedule 4--Deductible gift recipients 2 3 Income Tax Assessment Act 1997 4 1 Subsection 30-25(2) (at the end of the table) 5 Add: 2.2.37 The Royal Institution of Australia the gift must be made Incorporated after 16 April 2009 6 2 Subsection 30-80(2) (at the end of the table) 7 Add: 9.2.21 Dip lo macy Training Program Limited the gift must be made after 16 April 2009 8 3 Section 30-105 (after table item 13.2.3) 9 Insert: 13.2.3 Leeuwin Ocean Adventure Foundation the gift must be made A Limited after 16 April 2009 10 4 Section 30-315 (after table item 44) 11 Insert: 44AAA Dip lo macy Training Program Limited item 9.2.21 12 5 Section 30-315 (after table item 65) 13 Insert: 65A Leeuwin Ocean Adventure Foundation item 13.2.3A Limited 14 6 Section 30-315 (after table item 103) 15 Insert: 103A Royal Institution of Australia Incorporated item 2.2.37 16 7 Application of amendments 17 The amendments made by this Schedule apply in relation to 18 assessments for: 19 (a) the 2009-10 income year; and 20 (b) later income years. Tax Laws Amendment (2009 Measures No. 3) Bill 2009 No. , 2009 39