Commonwealth Consolidated Acts Commonwealth Consolidated Acts54. After Division 1B of Part VI of the Principal Act the following Division
"Division 1C-Payment of instalments by companies and
"221AZH. In this Division, unless the contrary intention appears:
'amount', in relation to an estimate, includes a nil amount;
'current year' means the year of income for which instalments are being
'due date', in relation to a particular instalment, means the due date
specified in Table 1 in section 221AZK, whether or not the taxpayer is
actually required to pay that instalment;
'estimate' means an estimate under section 221AZO;
(a) for a small taxpayer-the single instalment specified in Table 1 in
(b) for any other taxpayer-the 4th instalment specified in that table;
'instalment' means an instalment under section 221AZK;
'instalment taxpayer' means a taxpayer specified in subsection 221AZK(1);
'large taxpayer' means a taxpayer who is classified as large in accordance
with Table 1 in section 221AZK;
'likely tax' means the likely tax calculated under Subdivision C;
'medium taxpayer' means a taxpayer who is classified as medium in accordance
with Table 1 in section 221AZK;
'small taxpayer' means a taxpayer who is classified as small in accordance
with Table 1 in section 221AZK;
'taxable income', in relation to a taxpayer in the capacity of trustee of a
fund or trust, means the taxable income or net income, as appropriate, of the
References to tax payable modified for years in which taxpayer had net capital
"221AZI.(1) This section applies if:
(a) the taxpayer's assessable income of a year of income ('the gain year')
included a net capital gain; and
(b) the amount of the tax assessed or payable by the taxpayer for the gain
year is relevant for either of the following purposes:
(i) calculating the likely tax for the current year;
(ii) determining whether a penalty is payable under section 221AZP
in respect of an estimate made for the current year; and
(ii) the trustee of a trust that is a corporate unit trust in
relation to the current year for the purposes of Division 6B of Part III; or
(iii) the trustee of a trust that is a public trading trust in
relation to the current year for the purposes of Division 6C of Part III.
"(2) References in this Division to the tax assessed or payable for the gain
year are to be read as references to that tax, as recalculated in accordance
with this section. The recalculated amount applies only for the purposes
mentioned in paragraph (1) (b).
"(3) If the taxpayer is a life assurance company or registered organisation,
the tax is to be recalculated as the sum of:
(a) the tax on the CS/RA component of the taxable income; and
(b) the tax on the other components, recalculated on the basis that the
assessable income to which the components relate did not include any net
"(4) In all other cases, the tax is to be recalculated on the basis that the
assessable income did not include any net capital gain.
'CS/RA component' has the same meaning as in Division 8 or 8A of Part III,
'life assurance company' has the same meaning as in Division 8 of Part III;
'net capital gain' means a net capital gain within the meaning of Part
'registered organisation' has the same meaning as in Division 8A of Part
"Subdivision B-General rules for payment of instalments
"221AZJ. The object of this Division is to ensure the efficient collection
of tax payable by instalment taxpayers.
"221AZK.(1) The following taxpayers are instalment taxpayers in relation to
a year of income ('the current year'):
(b) the trustee of a trust that is a corporate unit trust in relation to the
current year for the purposes of Division 6B of Part III;
(c) the trustee of a trust that is a public trading trust in relation to the
current year for the purposes of Division 6C of Part III;
(d) the trustee of a fund that is an eligible ADF (as defined in section
267) in relation to the current year;
(e) the trustee of a fund that is an eligible superannuation fund
(as defined in section 267) in relation to the current year;
(f) the trustee of a fund that is a pooled superannuation trust (as defined
in section 267) in relation to the current year.
"(2) An instalment taxpayer is liable to pay instalments for the current
year in accordance with the following table:
Likely tax on first day of month 9
Instalment(s) due on first day of:
100% of assessed tax for current year
25% of likely tax for current year
25% of likely tax for current year
25% of likely tax for current year
assessed tax for current year, less previous instalments
25% of likely tax for current year
25% of likely tax for current year
25% of likely tax for current year
assessed tax for current year, less previous instalments
"(3) For the purposes of Table 1:
(a) a taxpayer is classified as small, medium or large according to the
taxpayer's likely tax for the current year, calculated on the first day of
(b) months are reckoned from the start of the current year;
(For example, if the current year starts on 1 July 1995 then month 12 will be
June 1996 and month 15 will be September 1996.)
(c) 'assessed tax' means the tax payable for the current year, as shown in
the taxpayer's return for the current year.
"(4) Instalments are to be calculated to the nearest dollar.
"(5) Instalments are to be treated as tax for the purposes of sections 206,
207, 207A, 208, 209, 214, 254, 255, 258 and 259. However, in applying sections
207 and 207A in relation to the final instalment, the credits and offsets
specified in paragraph 221AZP (1) (b) are to be deducted from that instalment.
Commissioner may waive or reduce instalment
"221AZL.(1) The Commissioner may determine that a particular instalment is
not payable, or is reduced, if the Commissioner is satisfied that it is
appropriate to do so having regard to the object of this Division and the
particular circumstances of the taxpayer.
"(2) If the amount of an instalment paid by a taxpayer turns out to be
excessive because of a determination later made under subsection (1), the
Commissioner must refund the excess.
Instalments to be credited against current year's tax etc.
"221AZM.(1) The Commissioner must credit an instalment in payment of the
(a) tax payable for the current year;
(b) tax payable under section 160AQJ;
(c) any other liability of the taxpayer to the Commonwealth that arises
under an Act of which the Commissioner has the general administration.
"(2) The Commissioner must refund any excess to the taxpayer.
"(3) An amount credited under this section is taken to be credited on the
day on which section 166A deems an assessment to have been made for the
taxpayer for the current year.
"Subdivision C-Calculating likely tax for current year
General rule for calculating likely tax
"221AZN.(1) The taxpayer's likely tax at any particular time is worked out
Situation existing at the particular time
The taxpayer has lodged an estimate
The estimated amount (or the last estimated amount if 2 estimates
The taxpayer has not lodged an estimate, but there is a previous
The previous year's tax amount
The taxpayer has not lodged an estimate and there is not a previous
year's tax amount, but there is an earlier year's tax amount
The earlier year's tax amount (or the earlier year's tax amount for
the most recent year of income if there are 2 or more such amounts)
"(2) For the purposes of Table 2:
'previous year's tax amount' means the amount assessed as the tax payable
for the year of income before the current year;
'earlier year's tax amount' means the amount assessed as the tax payable for
a year of income 2 or more years before the current year.
"(3) For the purposes of this section, a return lodged by the taxpayer
stating that no tax is payable is treated as an assessment of a nil amount of
"(4) The ascertainment of likely tax is not an assessment for the purposes
"Subdivision D-Estimates of current year's tax
Taxpayer may lodge estimates of current year's tax
"221AZO.(1) A taxpayer is entitled to lodge with the Commissioner up to 2
estimates of the tax (if any) that the taxpayer will be liable to pay for the
"(2) An estimate cannot be revoked.
Penalty applies if estimate is too low
"221AZP.(1) A taxpayer is liable to pay a penalty under this section in
respect of an estimate lodged by the taxpayer for the current year if the
estimated amount turns out to be more than 10% below the base amount. The base
amount is the lesser of the following amounts:
(a) the likely tax for the current year, immediately before the taxpayer
(b) the tax payable by the taxpayer for the current year, reduced by the
(i) credits under subsection 98A (2), Division 18 of Part III or
Division 3A of this Part, or under the Income Tax (International Agreements)
(ii) offsets under section 160AQK.
"(2) The penalty applies to the difference between the estimated amount and
"(3) The penalty is calculated at the rate of 16% per year for the period
(a) starts on the later of the following dates:
(i) the date on which the taxpayer lodged the estimate;
(ii) the earliest date on which the taxpayer would have had to pay
an instalment for the current year if the estimate had not been lodged; and
(b) ends on the earlier of the following dates:
(i) the date on which the taxpayer lodges another estimate for the
(ii) the due date for the last instalment.
"(4) The Commissioner may remit some or all of the penalty if the
Commissioner is satisfied that there are special circumstances that make it
"(5) Penalty under this section is to be treated as tax for the purposes of
sections 208, 209, 214, 254, 255, 258 and 259.
Refund of excessive instalment on downwards estimate
"221AZQ.(1) If a medium or large taxpayer lodges an estimate after paying an
instalment, and the amount paid was more than it would have been if it had
been calculated on the basis of the estimate, the Commissioner must refund the
"(2) The refund is to be treated as reducing the amount of the instalment
concerned for all purposes of this Act (other than Part IIIAA).
"(3) No refund is payable under this section if the estimate is lodged after
the due date for the 3rd instalment.
Liability to pay an additional amount on upwards estimate
"221AZR.(1) If a medium or large taxpayer lodges an estimate after paying an
instalment, and the amount paid was less than it would have been if it had
been calculated on the basis of the estimate, the taxpayer must pay the
difference to the Commissioner at the time of lodging the estimate.
"(2) The taxpayer's additional payment is to be treated as being part of the
instalment concerned for all purposes of this Act (other than Part IIIAA).
"(3) This section does not apply if the estimate is lodged after the due
Taxpayer must specify taxable income etc. in return
"221AZS. In its return for the current year, an instalment taxpayer must
(a) its taxable income for the current year; and
(b) the amount (if any) of the tax payable on that taxable income.
"221AZT. The tax payable by an instalment taxpayer for the current year
becomes due and payable as follows:
(a) on the due date for the final instalment, if taxpayer lodges the
taxpayer's return for the current year on or before the due date for the final
(b) on the date on which the taxpayer lodges the taxpayer's return for the
current year, if the taxpayer lodges the return after the due date for the
"221AZU. Part IVA and the related provisions of this Act apply for the
purposes of this Division as if references in that Part to a taxpayer
obtaining a tax benefit included references to a taxpayer obtaining a benefit
in relation to the operation of this Division.".
Subdivision B - Application and transitional