Commonwealth Consolidated Acts

INCOME TAX RATES ACT 1986 - SECT 3

             (1)  In this Act, unless the contrary intention appears:

"abnormal income amount" , in relation to the taxable income of a taxpayer of a year of income, means any above-average special professional income included in the taxpayer's taxable income for the year of income under section 405-15 of the Income Tax Assessment Act 1997 .

"ADI" has the same meaning as in the Income Tax Assessment Act 1997 .

"Assessment Act" means the Income Tax Assessment Act 1936 .

"complying ADF" means a complying approved deposit fund as defined in the Income Tax Assessment Act 1997 .

"complying superannuation/FHSA class" of the taxable income of a life insurance company has the same meaning as in the Income Tax Assessment Act 1997 .

"complying superannuation fund" has the same meaning as in the Income Tax Assessment Act 1997 .

"corporate unit trust" , in relation to a year of income, means a unit trust that is a corporate unit trust, within the meaning of Division 6B of Part III of the Assessment Act, in relation to the year of income.

"eligible ADF" means a fund that is a complying approved deposit fund or a non-complying approved deposit fund, as defined in the Income Tax Assessment Act 1997 .

"eligible part" , in relation to the special income component of the taxable income of a taxpayer, means so much of the special income component as is eligible taxable income for the purposes of Division 6AA of Part III of the Assessment Act .

"eligible superannuation fund" means a fund that is a complying superannuation fund or a non-complying superannuation fund, as defined in the Income Tax Assessment Act 1997 .

"employment termination remainder" of taxable income means so much of the taxable income as:

                     (a)  is included in assessable income under a maximum tax rate provision in Division 82 of the Income Tax Assessment Act 1997 or Division 82 of the Income Tax (Transitional Provisions) Act 1997 ; and

                     (b)  does not give rise to an entitlement to a tax offset under that maximum tax rate provision.

"FHSA component" has the same meaning as in the Income Tax Assessment Act 1997 .

"FHSA provider" has the same meaning as in the Income Tax Assessment Act 1997 .

"FHSA trust" has the same meaning as in the Income Tax Assessment Act 1997 .

"friendly society" has the same meaning as in the Income Tax Assessment Act 1997 .

"life insurance company" has the same meaning as in the Life Insurance Act 1995 .

"low tax component" has the same meaning as in the Income Tax Assessment Act 1997 .

"maximum tax rate provision" means any of the following provisions:

                     (a)  section 82‑10 of the Income Tax Assessment Act 1997 ;

                     (b)  section 82‑65 of the Income Tax Assessment Act 1997 ;

                     (c)  section 82‑70 of the Income Tax Assessment Act 1997 ;

                     (d)  section 301‑95 of the Income Tax Assessment Act 1997 ;

                     (e)  section 301‑105 of the Income Tax Assessment Act 1997 ;

                      (f)  section 301‑115 of the Income Tax Assessment Act 1997 ;

                     (g)  section 82‑10A of the Income Tax (Transitional Provisions) Act 1997 ;

                     (h)  section 82‑10C of the Income Tax (Transitional Provisions) Act 1997 .

"non-arm's length component" has the same meaning as in the Income Tax Assessment Act 1997 .

"non-complying ADF" means a fund that, at all times during the year of income when the fund is in existence, is an approved deposit fund within the meaning of the Income Tax Assessment Act 1997 , but does not include a fund that is a complying ADF.

"non-complying superannuation fund" has the same meaning as in the Income Tax Assessment Act 1997 .

"non-profit company" means:

                     (a)  a company that is not carried on for the purposes of profit or gain to its individual members and is, by the terms of the company's constituent document, prohibited from making any distribution, whether in money, property or otherwise, to its members; or

                     (b)  a friendly society dispensary.

"non-resident beneficiary" , in relation to a year of income, means a beneficiary of a trust estate who is a prescribed non-resident in relation to that year of income.

"non-resident taxpayer" , in relation to a year of income, means a taxpayer who is a prescribed non-resident in relation to that year of income.

"non-resident trust estate" , in relation to a year of income, means a trust estate that is not a resident trust estate in relation to that year of income.

"no-TFN contributions income" has the same meaning as in the Income Tax Assessment Act 1997 .

"ordinary class" of the taxable income of a life insurance company has the same meaning as in the Income Tax Assessment Act 1997 .

"ordinary taxable income" means the taxable income, reduced by the superannuation remainder of the taxable income and by the employment termination remainder of the taxable income.

"PDF" (pooled development fund) has the same meaning as in the Assessment Act.

"PDF component" has the same meaning as in the Assessment Act.

"pooled superannuation trust" has the same meaning as in the Income Tax Assessment Act 1997 .

"prescribed non-resident" , in relation to a year of income, means a person who, at all times during the year of income, is a non-resident, not being a person to whom, at any time during the year of income, compensation or a pension, allowance or benefit is payable under:

                     (a)  the Veterans' Entitlements Act 1986 ;

                     (b)  subsection 4(6) of the Veterans' Entitlements (Transitional Provisions and Consequential Amendments) Act 1986 ; or

                    (ba)  the Military Rehabilitation and Compensation Act 2004 ; or

                     (c)  the Social Security Act 1991 ;

being compensation or a pension, allowance or benefit in respect of which the person is liable to be assessed and to pay income tax in Australia.

"prescribed unit trust" , in relation to a year of income, means a trust estate that:

                     (a)  is a corporate unit trust in relation to the year of income; or

                     (b)  is a public trading trust in relation to the year of income.

"public trading trust" , in relation to a year of income, means a unit trust that is a public trading trust, within the meaning of Division 6C of Part III of the Assessment Act, in relation to the year of income.

"reduced taxable income" means the part (if any) of the taxable income other than the special income component.

"resident beneficiary" , in relation to a year of income, means a beneficiary of a trust estate who is not a prescribed non-resident in relation to that year of income.

"resident taxpayer" , in relation to a year of income, means a taxpayer who is not a prescribed non-resident in relation to that year of income.

"resident trust estate" , in relation to a year of income, means a trust estate that, under subsection 95(2) of the Assessment Act, is to be taken to be a resident trust estate in relation to that year of income.

"RSA component" has the same meaning as in the Income Tax Assessment Act 1997 .

"SME income component" has the same meaning as in Subdivision B of Division 10E of Part III of the Assessment Act.

"special income component" , in relation to a taxable income for which there is an abnormal income amount, means:

                     (a)  so much of the taxable income as does not exceed the abnormal income amount; or

                     (b)  if the sum (the component sum ) of:

                              (i)  the abnormal income amount; and

                             (ii)  the superannuation remainder of the taxable income; and

                            (iii)  the employment termination remainder of the taxable income;

                            is more than the taxable income--the abnormal income amount, reduced by the amount by which the component sum exceeds the taxable income.

"standard component" has the same meaning as in the Income Tax Assessment Act 1997 .

"superannuation remainder" of taxable income means so much of the taxable income as:

                     (a)  is included in assessable income under a maximum tax rate provision in Division 301 of the Income Tax Assessment Act 1997 ; and

                     (b)  does not give rise to an entitlement to a tax offset under that maximum tax rate provision.

"tax" means income tax imposed as such by any Act other than income tax payable in accordance with section 121H, 126, 128B, 128N, 128NA, 128NB, 128T, 128V, 136A or 159C of the Assessment Act.

"tax offset" has the same meaning as in the Income Tax Assessment Act 1997 .

"unregulated investment component" has the same meaning as in Subdivision B of Division 10E of Part III of the Assessment Act.

             (2)  In this Act:

                     (a)  a reference to net income, taxable income or reduced taxable income shall be read as a reference to net income, taxable income or reduced taxable income, as the case may be, of the year of income; and

                     (b)  a reference to eligible taxable income for the purposes of Division 6AA of Part III of the Assessment Act shall be read as a reference to eligible taxable income of the year of income for the purposes of that Division.

             (3)  A reference in this Act to the part to which Division 6AA of Part III of the Assessment Act applies of the share of a beneficiary of the net income of a trust estate shall, if that Division applies to the whole of such a share, be read as a reference to the whole of that share.