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TAXATION LAWS AMENDMENT ACT (NO. 5) 2001 - SCHEDULE 1 Religious practitioners

TAXATION LAWS AMENDMENT ACT (NO. 5) 2001 - SCHEDULE 1

Religious practitioners

 

A New Tax System (Australian Business Number) Act 1999

1   After section   5

Insert:

5A   Application to religious practitioners and religious institutions

    If a * religious practitioner:

  (a)   does an activity, or a series of activities:

  (i)   in pursuit of his or her vocation as a religious practitioner; and

  (ii)   as a member of a religious institution; and

  (b)   does not do the activity, or series of activities, as an employee or agent of the religious institution or another entity;

this Act applies as if the activity, or series of activities, had been done by the religious institution and not by the religious practitioner.

Note:   This will mean that such an activity will be an enterprise of the religious institution under subsection 38(1) and not an enterprise of the religious practitioner.

2   Section   41

Insert:

"religious practitioner" means:

  (a)   a minister of religion; or

  (b)   a student at an institution who is undertaking a course of instruction in the duties of a minister of religion; or

  (c)   a full - time member of a religious order; or

  (d)   a student at a college conducted solely for training persons to become members of religious orders.

3   Application

The amendments of the A New Tax System (Australian Business Number) Act 1999 made by this Schedule apply to activities done by a religious practitioner on or after 1   July 2000.

A New Tax System (Goods and Services Tax) Act 1999

4   After Division   49

Insert:

Division   50 -- GST treatment of religious practitioners

Guide to Division   50

50 - 1   What this Division is about

Activities of a religious practitioner done in pursuit of his or her vocation as a religious practitioner and as a member of a religious institution will be treated as activities done by the religious institution, unless the religious practitioner is acting as an employee or agent.

Table of sections

50 - 5   GST treatment of religious practitioners

50 - 5   GST treatment of religious practitioners

    If a * religious practitioner:

  (a)   does an activity, or a series of activities:

  (i)   in pursuit of his or her vocation as a religious practitioner; and

  (ii)   as a member of a religious institution; and

  (b)   does not do the activity, or series of activities, as an employee or agent of the religious institution or another entity;

the * GST law applies as if the activity, or series of activities, had been done by the religious institution and not by the religious practitioner.

Note:   This will mean that such an activity will be an enterprise of the religious institution under subsection 9 - 20(1) and not an enterprise of the religious practitioner.

5   Section   195 - 1

Insert:

"religious practitioner" means:

  (a)   a minister of religion; or

  (b)   a student at an institution who is undertaking a course of instruction in the duties of a minister of religion; or

  (c)   a full - time member of a religious order; or

  (d)   a student at a college conducted solely for training persons to become members of religious orders.

6   Application

The amendments of the A New Tax System (Goods and Services Tax) Act 1999 made by this Schedule apply to activities done by a religious practitioner on or after 1   July 2000.

Fringe Benefits Tax Assessment Act 1986

7   Subsection 136(1) (definition of salary or wages )

Repeal the definition, substitute:

"salary or wages" means:

  (a)   a payment from which an amount must be withheld (even if the amount is not withheld) under a provision in Schedule   1 to the Taxation Administration Act 1953 listed in the table, to the extent that the payment is assessable income; and

  (b)   a payment from which an amount must be withheld (even if the amount is not withheld) under section   12 - 47 in Schedule   1 to the Taxation Administration Act 1953 where:

  (i)   the payment is made to a religious practitioner by a religious institution; and

  (ii)   the activity, or series of activities, for which the payment is made is done by the religious practitioner as a member of the religious institution.

 

Withholding payments covered

Item

Provision

Subject matter

1

Section   12 - 35

Payment to employee

2

Section   12 - 40

Payment to company director

3

Section   12 - 45

Payment to office holder

4

Section   12 - 115

Commonwealth education or training payment

5

Section   12 - 120

Compensation, sickness or accident payment

8   Application

The amendment of the Fringe Benefits Tax Assessment Act 1986 made by item   7 of this Schedule applies to payments made on or after 1   July 2002.

9   Transitional treatment of payments to religious practitioners

(1)   This item applies to payments made to religious practitioners during the period (the transitional period ) from the start of 1   July 2000 until the end of 30   June 2002.

(2)   For the purposes of the Fringe Benefits Tax Assessment Act 1986 , a payment to a religious practitioner during the transitional period is taken to be a payment of salary or wages if it would have been a payment of salary or wages had it been made immediately after the end of the transitional period.

(3)   In this item, religious practitioner has the meaning given by subsection 136(1) of the Fringe Benefits Tax Assessment Act 1986 .

Income Tax Assessment Act 1997

10   Subsection 26 - 30(6)

Repeal the subsection, substitute:

Withholding payments covered

  (6)   This subsection covers:

  (a)   a * withholding payment covered by any of the provisions in Schedule   1 to the Taxation Administration Act 1953 listed in the table; and

  (b)   a withholding payment covered by section   12 - 47 in Schedule   1 to the Taxation Administration Act 1953 where:

  (i)   the payment is made to a religious practitioner by a religious institution; and

  (ii)   the activity, or series of activities, for which the payment is made is done by the religious practitioner as a member of the religious institution.

 

Withholding payments covered

Item

Provision

Subject matter

1

Section   12 - 40

Payment to company director

2

Section   12 - 45

Payment to office holder

3

Section   12 - 50

Return to work payment

4

Subdivision   12 - D

Benefit, training and compensation payments

11   Subsection 28 - 185(3) (after table item   3)

  Insert:

 

3A

Section   12 - 47

Payment to * religious practitioner

12   Section   85 - 35 (heading)

Repeal the heading, substitute:

85 - 35   Exception: employees, office holders and religious practitioners

13   At the end of section   85 - 35

Add:

  (2)   This Division does not apply to an amount, payment or contribution to the extent that the amount, payment or contribution relates to a payment referred to in section   12 - 47 in Schedule   1 to the Taxation Administration Act 1953 (payments to * religious practitioners).

14   Subsection 130 - 90(5) (after table item   3)

Insert:

 

3A

Section   12 - 47

Payment to * religious practitioner

15   Subsection 900 - 12(3) (after table item   3)

Insert:

 

3A

Section   12 - 47

Payment to * religious practitioner

16   Subsection 995 - 1(1)

Insert:

"religious practitioner" means:

  (a)   a minister of religion; or

  (b)   a student at an institution who is undertaking a course of instruction in the duties of a minister of religion; or

  (c)   a full - time member of a religious order; or

  (d)   a student at a college conducted solely for training persons to become members of religious orders.

17   Application

The amendments of the Income Tax Assessment Act 1997 made by this Schedule apply to any withholding payments mentioned in those amendments that an individual receives, or is entitled to receive, on or after 1   July 2002.

Taxation Administration Act 1953

18   Subsection 10 - 5(1) in Schedule   1 (after table item   3)

Insert:

 

3A

a payment to a * religious practitioner

12 - 47

19   Subsection 12 - 1(1) in Schedule   1

After "12 - 45,", insert "12 - 47,".

20   Subsection 12 - 1(2) in Schedule   1

After "12 - 45,", insert "12 - 47,".

21   Subsection 12 - 1(3) in Schedule   1

After "12 - 45," insert "12 - 47,".

22   Subsection 12 - 5(2) in Schedule   1 (table item   1, column 2)

After "12 - 45", insert ", 12 - 47".

23   Subsection 12 - 5(2) in Schedule   1 (after table item   1)

Insert:

 

1A

section   12 - 35 or 12 - 45

a payment for work or services

section   12 - 47 (a payment to a * religious practitioner)

24   After section   12 - 45 in Schedule   1

Insert:

12 - 47   Payment to religious practitioners

    An entity must withhold an amount from a payment it makes to a * religious practitioner for an activity, or a series of activities, if:

  (a)   the activity, or series of activities, is done by the religious practitioner in pursuit of his or her vocation as a religious practitioner; and

  (b)   the activity, or series of activities, is done by the religious practitioner as a member of a religious institution; and

  (c)   the payment is made by the entity in the course or furtherance of an enterprise that the entity carries on.

25   Application

The amendments of the Taxation Administration Act 1953 made by this Schedule apply to payments made on or after 1   July 2002.