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This is a Bill, not an Act. For current law, see the Acts databases.
1998
The Parliament of
the
Commonwealth of
Australia
HOUSE OF
REPRESENTATIVES
Presented and read a first
time
A New Tax
System (Bonuses for Older Australians) Bill
1998
No. ,
1998
(Family and Community
Services)
A Bill for an Act to implement A
New Tax System by providing bonus payments to older Australians, and for related
purposes
ISBN: 0642
379408
Contents
A Bill for an Act to implement A New Tax System by
providing bonus payments to older Australians, and for related
purposes
The Parliament of Australia enacts:
This Act may be cited as the A New Tax System (Bonuses for Older
Australians) Act 1998.
(1) This Act commences, or is taken to have commenced:
(a) after all the Acts listed in subsection (2) have received the Royal
Assent; and
(b) on the day after the last day on which any of those Acts received the
Royal Assent.
(2) These are the Acts that must have received the Royal Assent for this
Act to commence:
(a) the A New Tax System (Goods and Services Tax) Act
1998;
(b) the A New Tax System (Goods and Services Tax Administration) Act
1998;
(c) the A New Tax System (Goods and Services Tax
Imposition—Excise) Act 1998;
(d) the A New Tax System (Goods and Services Tax
Imposition—Customs) Act 1998;
(e) the A New Tax System (Goods and Services Tax
Imposition—General) Act 1998.
(1) This Act provides for a one-off tax free bonus payment to be made to
individuals. The bonus payment generally consists of 2 components:
(a) an aged persons savings bonus of up to $1,000; and
(b) a self-funded retirees supplementary bonus of up to $2,000.
(2) The basic qualifications for the aged persons savings bonus
are:
(a) an individual is aged 60 or more, and is an Australian resident, on 1
July 2000; and
(b) he or she has an income amount of less than $30,000, and a savings and
investment income amount, for 1998-1999 or 1999-2000.
(3) The basic qualifications for the self-funded retirees supplementary
bonus are:
(a) an individual qualifies for the aged persons savings bonus;
and
(b) on 1 July 2000, he is aged 65 or more or she is aged
611/2 or more;
and
(c) he or she has a savings and investment income amount of more than
$1,000 for 1998-1999 or 1999-2000; and
(d) he or she has not received certain pensions or benefits during the
period 1 April 2000 to 1 July 2000.
(4) The bonus payment is reduced progressively for income amounts between
$20,000 and $30,000.
(5) An individual has to claim the payment. A decision on whether an
individual is qualified for a bonus payment will be made by the Secretary to the
Department of Family and Community Services, the Repatriation Commission or the
Commissioner of Taxation, depending on whose customer or client the individual
is.
(6) These decisions are subject to review. For Family and Community
Services customers, review is under the Social Security Act 1991. For
Veterans’ Affairs customers, review is under the Veterans’
Entitlements Act 1986. For ATO clients, review is under the Taxation
Administration Act 1953.
In this Part, unless the contrary intention appears:
annual retirement income has the meaning given by sections 5
and 6.
annual savings and investment income has the meaning given by
sections 5 and 6.
Australian resident has the same meaning as in the Social
Security Act 1991.
bereavement allowance has the same meaning as in the
Social Security Act 1991.
carer service pension has the same meaning as in the
Veterans’ Entitlements Act 1986.
deprived asset has the same meaning as in the Social
Security Act 1991.
disqualifying payment means any of the following:
(a) a social security pension (other than a bereavement
allowance);
(b) a social security benefit;
(c) a service pension;
(d) a carer service pension;
(e) an income support supplement.
Family and Community Services customer has the meaning given
by section 7.
financial asset has the same meaning as in the Social
Security Act 1991.
financial investment has the same meaning as in the Social
Security Act 1991.
income support supplement has the same meaning as in the
Veterans’ Entitlements Act 1986.
income tax return has the same meaning as in the Income
Tax Assessment Act 1997.
income year has the same meaning as in the Income Tax
Assessment Act 1997.
member of a couple has the same meaning as in the Social
Security Act 1991.
partner has the same meaning as in the Social Security Act
1991.
proper claim has the meaning given by section 7.
qualifying year means the year commencing on 1 July 1998 or
the year commencing on 1 July 1999.
savings and investments includes financial
investments.
Secretary means the Secretary to the Department.
service pension has the same meaning as in the
Veterans’ Entitlements Act 1986.
social security benefit has the same meaning as in the
Social Security Act 1991.
social security pension has the same meaning as in the
Social Security Act 1991.
(1) This section applies to a Family and Community Services customer if,
on one or more occasions in the period covered by the 2 qualifying years, the
Secretary was required to work out the customer’s ordinary income on a
yearly basis for the purpose of determining the customer’s entitlement to
any payment under the Social Security Act 1991.
(2) If the Secretary was required to work out the amount on only one such
occasion, the customer’s annual retirement income and
annual savings and investment income for the purposes of this Part
are worked out in accordance with subsections (3) and (4).
(3) The customer’s annual retirement income is the
amount of the ordinary income on a yearly basis that would have been required to
be worked out on the occasion if:
(a) any pension under Part II or IV, or a payment by way of allowance
under Part VI, of the Veterans’ Entitlements Act 1986 paid to the
customer were disregarded; and
(b) any application of section 1171 of the Social Security Act 1991
were disregarded; and
(c) any payment under the Social Security Act 1991, to the extent
that it was not exempt from income tax under the Income Tax Assessment Act
1997, were included in ordinary income; and
(d) any amount taken by Division 1B of Part 3.10 of the Social Security
Act 1991 to be ordinary income on a financial asset that is a deprived asset
were disregarded; and
Note: Any actual return on the deprived asset is also
disregarded: see subsection 1083(1) of the Social Security Act
1991.
(e) the customer were not a member of a couple.
(4) The customer’s annual savings and investment income
is worked out as follows:
Method statement
Step 1. Work out under subsection (3) what would be the
customer’s annual retirement income if, in addition to making the
assumptions in that subsection, it were assumed that the below threshold rate
determined under subsection 1082(1) of the Social Security Act 1991 were
the same as the above threshold rate determined under subsection 1082(2) of that
Act.
Step 2. Work out how much of the Step 1 amount is attributable to
savings and investments. The result is the customer’s annual savings
and investment income.
(5) If the Secretary was required to work out the customer’s
ordinary income on a yearly basis on 2 or more occasions during the period
covered by the 2 qualifying years, the customer’s annual retirement
income and annual savings and investment income for the
purposes of this Part are worked out as follows:
Method statement
Step 1. Apply subsections (3) and (4) to work out the 2 amounts for
each of the occasions.
Step 2. Work out for each occasion the amount of bonus payment to
which the customer would be entitled on the basis of the 2 amounts.
Step 3. The customer’s annual retirement income
and annual savings and investment income are the 2 amounts for any
occasion that results in the greatest bonus payment or, if the bonus payments
for all of the occasions are the same, the 2 amounts for any occasion.
(1) If section 5 does not apply to a Family and Community Services
customer, the customer’s annual retirement income and
annual savings and investment income for the purposes of this Part
are worked out in accordance with this section.
(2) The customer’s annual retirement income is the
customer’s ordinary income on a yearly basis worked out:
(a) on the basis of the customer’s circumstances at the time the
Secretary first determines the customer’s entitlement to a bonus payment
under this Part; and
(b) by making the assumptions in paragraphs 5(3)(a) to (e).
(3) The customer’s annual savings and investment income
is worked out as follows:
Method statement
Step 1. Work out under subsection (2) what would be the
customer’s annual retirement income if, in addition to making the
assumptions in paragraphs 5(3)(a) to (e), it were assumed that the below
threshold rate determined under subsection 1082(1) of the Social Security
Act 1991 were the same as the above threshold rate determined under
subsection 1082(2) of that Act.
Step 2. Work out how much of the Step 1 amount is attributable to
savings and investments. The result is the customer’s annual savings
and investment income.
(1) An individual who wants to be paid a bonus payment under this Part
must make a proper claim for the payment.
(2) A claim by an individual for a bonus payment under this Part is a
proper claim if:
(a) he or she is not required to lodge an income tax return for the
1999-2000 income year; and
(b) at the time of making the claim, he or she has not lodged an income
tax return for that income year; and
(c) in the claim, he or she states that he or she does not intend to lodge
an income tax return for that income year; and
(d) on 1 July 2000, he or she is not receiving a service pension, a carer
service pension or an income support supplement; and
(e) the claim is made after 30 June 2000 and before 1 July 2001;
and
(f) the claim is given to the Secretary in a form (which may be an
electronic form), and in a manner, approved by the Secretary.
(3) An individual who makes a proper claim is a Family and Community
Services customer.
(1) A Family and Community Services customer can withdraw a proper claim
that has not been determined.
(2) A proper claim that is withdrawn is taken not to have been
made.
(3) A withdrawal may be made orally or in writing.
A Family and Community Services customer cannot make more than one proper
claim for a bonus payment under this Part.
A Family and Community Services customer is qualified for a bonus payment
under this Part if the customer is qualified for:
(a) only
the aged persons savings bonus component of the bonus payment; or
(b) the aged persons savings bonus component, and the self-funded retirees
supplementary bonus component, of the bonus payment.
Aged persons savings bonus component
(1) A Family and Community Services customer is qualified for the aged
persons savings bonus component of a bonus payment if:
(a) he or she is aged 60 or more on 1 July 2000; and
(b) he or she is an Australian resident on 1 July 2000; and
(c) his or her annual retirement income is less than $30,000 and he or she
has annual savings and investment income; and
Note: The customer’s annual retirement income
and annual savings and investment income are worked out
based on 2 qualifying years or the customer’s circumstances at the time
his or her bonus entitlement is determined under this Part: see sections 5 and
6.
(d) the amount of the component, worked out under subsection 15(2), is
greater than nil.
Self-funded retirees supplementary bonus component
(2) A Family and Community Services customer is qualified for the
self-funded retirees supplementary bonus component of a bonus payment
if:
(a) he or she is qualified for the aged persons savings bonus component of
the bonus payment; and
(b) on 1 July 2000, he is aged 65 or more or she is aged
611/2 or more;
and
(c) at least one of the following applies:
(i) he or she did not receive a disqualifying payment at any time during
the period from the start of 1 April 2000 until the end of 1 July
2000;
(ii) he or she received a disqualifying payment during the period from the
start of 1 April 2000 until the end of 30 June 2000, his or her partner died
during that period and he or she is not receiving a disqualifying payment on 1
July 2000;
(iii) he or she received a disqualifying payment during the period from
the start of 1 April 2000 until the end of 1 July 2000 in a circumstance
prescribed by the regulations for the purposes of this subparagraph;
and
(d) his or her annual savings and investment income is more than $1,000;
and
Note: The customer’s annual savings and investment
income is worked out based on either of 2 qualifying years or the
customer’s circumstances at the time his or her bonus entitlement is
determined under this Part: see sections 5 and 6.
(e) the amount of the self-funded retirees supplementary bonus component,
worked out under subsection 15(3), is greater than nil.
The Secretary must, in accordance with this Part, determine whether or
not a proper claim is to be granted.
(1) The Secretary must determine that a proper claim is to be granted if
the Secretary is satisfied that the Family and Community Services customer is
qualified for a bonus payment under this Part.
(2) The Secretary must give written notice of the determination to the
customer. The notice must:
(a) state that he or she is qualified for a bonus payment; and
(b) specify the amount of the bonus payment and how it was worked out;
and
(c) include
a statement to the effect that he or she may apply for a review of the
determination under section 1240 of the Social Security Act 1991, as
applied by this Act.
Note: A determination that a Family and Community Services
customer is qualified for a bonus payment under this Part is treated in the same
way as a determination that a person is qualified for a pension bonus under the
Social Security Act 1991: see section 18.
If the Secretary determines that a proper claim is not to be granted, the
Secretary must give written notice of the determination to the Family and
Community Services customer. The notice must:
(a) state that he or she is not qualified for a bonus payment;
and
(b) state the reasons for the Secretary’s determination;
and
(c) include a statement to the effect that he or she may apply for a
review of the determination under section 1240 of the Social Security Act
1991, as applied by this Act.
Note: A determination that a Family and Community Services
customer is not qualified for a bonus payment under this Part is treated in the
same way as a determination that a person is not qualified for a pension bonus
under the Social Security Act 1991: see section 18.
(1) The amount of a Family and Community Services customer’s bonus
payment is:
(a) if he or she is qualified for only the aged persons savings bonus
component of the bonus payment—the amount of that component; or
(b) if he or she is qualified for both the aged persons savings bonus
component and the self-funded retirees supplementary bonus component of the
bonus payment—the sum of those components.
Aged persons savings bonus component
(2) The aged persons savings bonus component of a bonus payment is worked
out in accordance with the following table:
|
Amount of aged persons savings bonus component |
||
|---|---|---|
|
Item |
If the Family and Community Services customer’s annual retirement
income is: |
...the amount of the aged persons savings bonus component is equal
to: |
|
1 |
$20,000 or less |
his or her annual savings and investment income, up to a maximum of
$1,000 |
|
2 |
more than $20,000 but less than $30,000 |
(a) his or her annual savings and investment income, up to a maximum of
$1,000; less |
Example: David has annual retirement income of $23,000 and
annual savings and investment income of $1,500.
David’s aged persons savings bonus component is
worked out as follows.
David’s annual savings and investment income of
$1,500 exceeds the maximum of $1,000, so only $1,000 is potentially
allowable.
The phasing out fraction of the $1,000 then needs to be
subtracted. The fraction is:
Therefore 3/10 of $1,000 (i.e. $300) needs to be
subtracted. This leaves an aged persons savings bonus component of
$700.
Self-funded retirees supplementary bonus component
(3) The self-funded retirees supplementary bonus component of a bonus
payment is worked out in accordance with the following table:
|
Amount of self-funded retirees supplementary bonus
component |
||
|---|---|---|
|
Item |
If the Family and Community Services customer’s annual retirement
income is: |
...the amount of the self-funded retirees supplementary bonus component
is equal to: |
|
1 |
$20,000 or less |
the amount, up to a maximum of $2,000, by which his or her annual savings
and investment income exceeds $1,000 |
|
2 |
more than $20,000 but less than $30,000 |
(a) the amount, up to a maximum of $2,000, by which his or her annual
savings and investment income exceeds $1,000; less |
Example: Kath has annual retirement income of $24,000 and
annual savings and investment income of $5,000.
Kath’s self-funded retirees supplementary bonus
component is worked out as follows.
Kath’s annual savings and investment income of $5,000
exceeds the lower limit of $1,000 by $4,000, but this is only allowable up to a
maximum of $2,000.
The phasing out fraction of the $2,000 then needs to be
subtracted. The fraction is:
Therefore 4/10 of $2,000 (i.e. $800) needs to be
subtracted. This leaves a self-funded retirees supplementary bonus component of
$1,200.
Kath is also entitled to an aged persons savings bonus
component of $600: worked out under subsection (2).
Kath is entitled to a bonus payment of
$1,800.
Bonus payments less than $1 rounded up to $1
(4) If the amount of a Family and Community Services customer’s
bonus payment worked out under this section is greater than nil and less than
$1, the amount is rounded up to $1.
(5) In this section:
phasing out fraction means the following
fraction:
If the Secretary determines that a Family and Community Services
customer’s claim for a bonus payment is to be granted, the Secretary must,
on behalf of the Commonwealth, make the bonus payment to the customer at such
time, and in such manner, as the Secretary determines.
Note: Under the Income Tax Assessment Act 1997, a
bonus payment is exempt from income tax.
The Secretary has the general administration of this Part.
(1) Except to the extent that provision is made in this Part, the
Social Security Act 1991 applies to:
(a) the making of a determination about whether to grant a proper claim
for a bonus payment under this Part; and
(b) the making of any payment as a result of such a determination;
and
(c) any other matter relating to such a determination or
payment;
in the same way as that Act applies to the making of determinations about,
and payments of, pension bonus under that Act.
(2) For the purposes of so applying the Social Security Act
1991:
(a) references in that Act to that Act itself are taken to include
references to this Act; and
(b) any modifications of that Act that are prescribed by the regulations
for the purposes of this section apply.
Note: This section means that the provisions of the
Social Security Act 1991 dealing with matters such as the following will
apply:
• review of determinations;
• recovery of overpayments;
• delegation;
• information gathering;
• offences relating to false
statements;
• evidentiary matters.
In this Part, unless the contrary intention appears:
annual retirement income has the meaning given by sections 20
and 21.
annual savings and investment income has the meaning given by
sections 20 and 21.
Australian resident has the same meaning as in the Social
Security Act 1991.
carer service pension has the same meaning as in the
Veterans’ Entitlements Act 1986.
Commission means the Repatriation Commission continued in
existence by section 179 of the Veterans’ Entitlements Act
1986.
deprived asset has the same meaning as in the
Veterans’ Entitlements Act 1986.
financial asset has the same meaning as in the
Veterans’ Entitlements Act 1986.
financial investment has the same meaning as in the
Veterans’ Entitlements Act 1986.
income support supplement has the same meaning as in the
Veterans’ Entitlements Act 1986.
income tax return has the same meaning as in the Income
Tax Assessment Act 1997.
income year has the same meaning as in the Income Tax
Assessment Act 1997.
member of a couple has the same meaning as in the
Veterans’ Entitlements Act 1986.
proper claim has the meaning given by section 22.
qualifying year means the year commencing on 1 July 1998 or
the year commencing on 1 July 1999.
relevant income tax law means the Income Tax Assessment
Act 1936 or the Income Tax Assessment Act 1997.
savings and investments includes financial
investments.
service pension has the same meaning as in the
Veterans’ Entitlements Act 1986.
Veterans’ Affairs customer has the meaning given by
section 22.
(1) This section applies to a Veterans’ Affairs customer if, on one
or more occasions in the period covered by the 2 qualifying years, the
Commission worked out the customer’s ordinary income on a yearly basis for
the purpose of determining the customer’s entitlement to any payment under
the Veterans’ Entitlements Act 1986.
(2) If the Commission worked out the amount on only one such occasion, the
customer’s annual retirement income and annual savings
and investment income for the purposes of this Part are worked out in
accordance with subsections (3) and (4).
(3) The customer’s annual retirement income is the
amount of the ordinary income on a yearly basis that would have been worked out
on the occasion if:
(a) any payment under the Veterans’ Entitlements Act 1986, to
the extent that it was not exempt from income tax under a relevant income tax
law, were included in ordinary income; and
(b) any amount taken by Division 3 of Part IIIB of the Veterans’
Entitlements Act 1986 to be ordinary income on a financial asset that is a
deprived asset were disregarded; and
Note: Any actual return on the deprived asset is also
disregarded: see subsection 46K(1) of the Veterans’ Entitlements Act
1986.
(c) the customer were not a member of a couple.
(4) The customer’s annual savings and investment income
is worked out as follows:
Method statement
Step 1. Work out under subsection (3) what would be the
customer’s annual retirement income if, in addition to making the
assumptions in that subsection, it were assumed that the below threshold rate
(within the meaning of the Veterans’ Entitlements Act 1986)
were the same as the above threshold rate (within the meaning of that
Act).
Step 2. Work out how much of the Step 1 amount is attributable to
savings and investments. The result is the customer’s annual savings
and investment income.
(5) If the Commission worked out the customer’s ordinary income on a
yearly basis on 2 or more occasions during the period covered by the 2
qualifying years, the customer’s annual retirement income
and annual savings and investment income for the purposes of this
Part are worked out as follows:
Method statement
Step 1. Apply subsections (3) and (4) to work out the 2 amounts for
each of the occasions.
Step 2. Work out for each occasion the amount of aged persons
savings bonus payment to which the customer would be entitled on the basis of
the 2 amounts.
Step
3. The customer’s annual retirement income and
annual savings and investment income are the 2 amounts for any
occasion that results in the greatest bonus payment or, if the bonus payments
for all of the occasions are the same, the 2 amounts for any occasion.
(1) If section 20 does not apply to a Veterans’ Affairs customer,
the customer’s annual retirement income and annual
savings and investment income for the purposes of this Part are worked
out in accordance with this section.
(2) The customer’s annual retirement income is the
amount that would have been the customer’s ordinary income on a yearly
basis when last worked out by the Commission before the Commission first
determines the customer’s entitlement to an aged persons savings bonus
payment under this Part if the assumptions in paragraphs 20(3)(a), (b) and (c)
were made.
(3) The customer’s annual savings and investment
income is worked out as follows:
Method statement
Step 1. Work out under subsection (2) what would be the
customer’s annual retirement income if, in addition to making the
assumptions in paragraphs 20(3)(a), (b) and (c), it were assumed that the below
threshold rate (within the meaning of the Veterans’ Entitlements Act
1986) were the same as the above threshold rate (within the meaning
of that Act).
Step 2. Work out how much of the Step 1 amount is attributable to
savings and investments. The result is the customer’s annual savings
and investment income.
(1) An individual who wants to be paid an aged persons savings bonus
payment under this Part must make a proper claim for the payment.
(2) A claim by an individual for an aged persons savings bonus payment
under this Part is a proper claim if:
(a) he or she is not required to lodge an income tax return for the
1999-2000 income year; and
(b) at the time of making the claim, he or she has not lodged an income
tax return for that income year; and
(c) in the claim, he or she states that he or she does not intend to lodge
an income tax return for that income year; and
(d) on 1 July 2000, he or she is receiving a service pension, a carer
service pension or an income support supplement; and
(e) the claim is made after 30 June 2000 and before 1 July 2001;
and
(f) the claim is given to the Commission in a form, and in a manner,
approved by the Commission.
(3) An individual who makes a proper claim is a Veterans’
Affairs customer.
(1) A Veterans’ Affairs customer can withdraw a proper claim that
has not been determined.
(2) A proper claim that is withdrawn is taken not to have been
made.
(3) A withdrawal may be made orally or in writing.
A Veterans’ Affairs customer cannot make more than one proper claim
for a bonus payment under this Part.
A Veterans’ Affairs customer is qualified for an aged persons
savings bonus payment under this Part if:
(a) he or she is aged 60 or more on 1 July 2000; and
(b) he or she is an Australian resident on 1 July 2000; and
(c) his or her annual retirement income is less than $30,000 and he or she
has annual savings and investment income; and
Note: The customer’s annual retirement income
and annual savings and investment income are worked out
based on 2 qualifying years or the customer’s circumstances at another
time: see sections 20 and 21.
(d) the amount of the bonus payment, worked out under section 29, is
greater than nil.
The Commission must, in accordance with this Part, determine whether or
not a proper claim is to be granted.
(1) The Commission must determine that a proper claim is to be granted if
the Commission is satisfied that the Veterans’ Affairs customer is
qualified for an aged persons savings bonus payment under this Part.
(2) The Commission must give written notice of the determination to the
customer. The notice must:
(a) state that he or she is qualified for an aged persons savings bonus
payment; and
(b) specify the amount of the bonus payment and how it was worked out;
and
(c) include a statement to the effect that he or she may apply for a
review of the determination under section 57 of the Veterans’
Entitlements Act 1986, as applied by this Act.
Note: A determination that a Veterans’ Affairs
customer is qualified for an aged persons savings bonus payment under this Part
is treated in the same way as a determination that a person is qualified for a
pension bonus under the Veterans’ Entitlements Act 1986: see
section 32.
If the Commission determines that a proper claim is not to be granted,
the Commission must give written notice of the determination to the
Veterans’ Affairs customer. The notice must:
(a) state that he or she is not qualified for an aged persons savings
bonus payment; and
(b) state the reasons for the Commission’s determination;
and
(c) include a statement to the effect that he or she may apply for a
review of the determination under section 57 of the Veterans’
Entitlements Act 1986, as applied by this Act.
Note: A determination that a Veterans’ Affairs
customer is not qualified for an aged persons savings bonus payment under this
Part is treated in the same way as a determination that a person is not
qualified for a pension bonus under the Veterans’ Entitlements Act
1986: see section 32.
(1) The amount of a Veterans’ Affairs customer’s aged persons
savings bonus payment is worked out in accordance with the following
table:
|
Amount of aged persons savings bonus payment |
||
|---|---|---|
|
Item |
If the Veterans’ Affairs customer’s annual retirement income
is: |
...the amount of the aged persons savings bonus payment is equal
to: |
|
1 |
$20,000 or less |
his or her annual savings and investment income, up to a maximum of
$1,000 |
|
2 |
more than $20,000 but less than $30,000 |
(a) his or her annual savings and investment income, up to a maximum of
$1,000; less |
Example: Ruth has annual retirement income of $23,000 and
annual savings and investment income of $1,500.
Ruth’s aged persons savings bonus payment is worked
out as follows.
Ruth’s annual savings and investment income of $1,500
exceeds the maximum of $1,000, so only $1,000 is potentially
allowable.
The phasing out fraction of the $1,000 then needs to be
subtracted. The fraction is:
Therefore 3/10 of $1,000 (i.e. $300) needs to be
subtracted. This leaves an aged persons savings bonus payment of
$700.
Bonus payments less than $1 rounded up to $1
(2) If the amount of a Veterans’ Affairs customer’s aged
persons savings bonus payment worked out under this section is greater than nil
and less than $1, the amount is rounded up to $1.
(3) In this section:
phasing out fraction means the following
fraction:
If the Commission determines that a Veterans’ Affairs
customer’s claim for an aged persons savings bonus payment is to be
granted, the Commission must, on behalf of the Commonwealth, make the bonus
payment to the customer at such time, and in such manner, as the Commission
determines.
Note: Under the Income Tax Assessment Act 1997, an
aged persons savings bonus payment is exempt from income
tax.
The Commission has the general administration of this Part.
(1) Except to the extent that provision is made in this Part, the
Veterans’ Entitlements Act 1986 applies to:
(a) the making of a determination about whether to grant a proper claim
for an aged persons savings bonus payment under this Part; and
(b) the making of any payment as a result of such a determination;
and
(c) any other matter relating to such a determination or
payment;
in the same way as that Act applies to the making of determinations about,
and payments of, pension bonus under that Act.
(2) For the purposes of so applying the Veterans’ Entitlements
Act 1986:
(a) references in that Act to that Act itself are taken to include
references to this Act; and
(b) any modifications of that Act that are prescribed by the regulations
for the purposes of this section apply.
Note: This section means that the provisions of the
Veterans’ Entitlements Act 1986 dealing with matters such as the
following will apply:
• review of determinations;
• recovery of overpayments;
• delegation;
• information gathering;
• offences relating to false
statements;
• evidentiary matters.
In this Part, unless the contrary intention appears:
adjusted savings and investment income has the meaning given
by section 34.
assessable income has the same meaning as in the Income
Tax Assessment Act 1997.
assessable recoupment has the same meaning as in the
Income Tax Assessment Act 1997.
assessment has the same meaning as in the Income Tax
Assessment Act 1997.
ATO client has the meaning given by section 35.
Australian resident has the same meaning as in the Social
Security Act 1991.
Australian source has the same meaning as in the Income
Tax Assessment Act 1997.
bereavement allowance has the same meaning as in the
Social Security Act 1991.
carer service pension has the same meaning as in the
Veterans’ Entitlements Act 1986.
Commissioner means the Commissioner of Taxation.
complying superannuation fund has the same meaning as in the
Income Tax Assessment Act 1997.
deduction has the same meaning as in the Income Tax
Assessment Act 1997.
derive has the same meaning as in the Income Tax
Assessment Act 1997.
disqualifying payment means any of the following:
(a) a social security pension (other than a bereavement
allowance);
(b) a social security benefit;
(c) a service pension;
(d) a carer service pension;
(e) an income support supplement.
income support supplement has the same meaning as in the
Veterans’ Entitlements Act 1986.
income tax return has the same meaning as in the Income
Tax Assessment Act 1997.
income year has the same meaning as in the Income Tax
Assessment Act 1997.
partner has the same meaning as in the Social Security Act
1991.
PAYE earnings has the same meaning as in the Income Tax
Assessment Act 1997.
proper claim has the meaning given by section 35.
qualifying year means the 1998-1999 income year or the
1999-2000 income year.
RSA has the same meaning as in the Income Tax Assessment
Act 1997.
savings and investment income has the meaning given by
section 34.
service pension has the same meaning as in the
Veterans’ Entitlements Act 1986.
social security benefit has the same meaning as in the
Social Security Act 1991.
social security pension has the same meaning as in the
Social Security Act 1991.
taxable income has the same meaning as in the Income Tax
Assessment Act 1997.
(1) In this Part, an individual’s adjusted savings and
investment income for a qualifying year is worked out as
follows:
Method statement
Step 1. Work out the individual’s savings and investment
income for the year: see subsections (3) and (4).
Step 2. Add to the Step 1 amount any contributions to a complying
superannuation fund or an RSA (retirement savings account) that the individual
made during the year to get superannuation benefits for himself or herself, or
for his or her dependants in the event of his or her death.
Step 3. Subtract from the Step 2 amount the sum of the
individual’s deductions for the year, to the extent that the deductions
relate to any or all of his or her savings and investment income.
Step 4. Subtract from the Step 3 amount any amount that the
individual can deduct under section 82AAT of the Income Tax Assessment Act
1936, as specified in a notice that he or she gives under that section, for
the contributions counted at Step 2.
Step 5. If the final result is nil or negative, the individual does
not have any adjusted savings and investment income.
Deductions unrelated to any particular income
(2) To avoid doubt, deductions that are not related to the derivation by
the individual of any particular amount of savings and investment income are not
subtracted under Step 3 of the Method statement in subsection (1).
Example: A deduction under Division 30 of the Income Tax
Assessment Act 1997 for a gift the individual makes to a charity is not
related to any particular savings and investment income of the individual.
Therefore, it is not subtracted under Step 3.
Savings and investment income
(3) In this Part, an individual’s savings and investment
income is the sum of the following:
(a) all of the individual’s assessable income that is not PAYE
earnings;
(b) any amount paid to the individual that is included in the
individual’s assessable income and that is covered by paragraph (c) of the
definition of salary or wages in subsection 221A(1) of the
Income Tax Assessment Act 1936, so long as:
(i) the payment is from an Australian source and is not a rebatable
benefit, or a rebatable pension, within the meaning of section 160AAA of that
Act or a payment of the kind mentioned in subsection 52-105(2) of the Income
Tax Assessment Act 1997; or
(ii) the payment is not from an Australian source and there is or has been
a deductible amount in relation to the annuity concerned within the meaning of
section 27H of the Income Tax Assessment Act 1936;
Note: This basically covers annuities and pensions etc. that
the individual purchased.
(c) so much of the amount of any eligible termination payment (as defined
in section 27A of the Income Tax Assessment Act 1936) made to the
individual as is included in the individual’s assessable income under
section 27B or 27C of that Act.
(4) However, an individual’s savings and investment income does not
include the following amounts:
(a) payments covered by paragraph (pa) of the definition of salary
or wages in subsection 221A(1) of the Income Tax Assessment Act
1936;
Note: That paragraph covers payments by way of remuneration
or allowances to members of certain local government bodies.
(b) assessable recoupments of amounts deductible under section 25-5 of the
Income Tax Assessment Act 1997 or section 69 of the Income Tax
Assessment Act 1936;
Note: Those 2 sections basically deal with tax-related
expenses.
(c) assessable recoupments of amounts deductible under section 25-60 of
the Income Tax Assessment Act 1997 or section 74 of the Income Tax
Assessment Act 1936.
Note: Those 2 sections basically deal with election
expenses.
(1) An
individual who wants to be paid a bonus payment under this Part must make a
proper claim for the payment.
(2) A claim by an individual for a bonus payment under this Part is a
proper claim if:
(a) either:
(i) he or she is required to lodge an income tax return for the 1999-2000
income year; or
(ii) he or she is not required to lodge an income tax return for that
income year, but lodges such a return and makes the claim at the same time or
afterwards, provided that he or she had not made a proper claim for a bonus
payment under Part 2 or 3 before lodging the return; and
(b) the claim is made after 30 June 2000 and before 1 July 2001;
and
(c) the claim specifies either 1 qualifying year, or both qualifying
years, in respect of which the individual claims he or she is qualified for a
bonus payment; and
(d) the claim is in a form (which may be an electronic form) approved by
the Commissioner; and
(e) the claim is sent to or lodged at an office of, or a place approved
by, the Commissioner.
(3) An individual who makes a proper claim is an ATO
client.
(4) If the claim specifies 1 qualifying year in respect of which the ATO
client claims he or she is qualified for a bonus payment, he or she cannot later
vary the claim to specify the other qualifying year.
(1) An ATO client can withdraw a proper claim that has not been
determined.
(2) A proper claim that is withdrawn is taken not to have been
made.
(3) A withdrawal may only be made by writing, or in a form (which may be
an electronic form) approved by the Commissioner, sent to or lodged at an office
of, or a place approved by, the Commissioner.
An ATO client cannot make more than one proper claim for a bonus payment
under this Part.
An
ATO client is qualified for a bonus payment under this Part if he or she is
qualified for:
(a) only the aged persons savings bonus component of the bonus payment;
or
(b) the aged persons savings bonus component, and the self-funded retirees
supplementary bonus component, of the bonus payment.
Aged persons savings bonus component
(1) An ATO client is qualified for the aged persons savings bonus
component of a bonus payment if:
(a) he or she is aged 60 or more on 1 July 2000; and
(b) he or she is an Australian resident on 1 July 2000; and
(c) his or her taxable income as shown in his or her assessment is less
than $30,000, and he or she has adjusted savings and investment income, for
either or each of the qualifying years specified in the claim; and
(d) the amount of the component, worked out under subsection 43(4), is
greater than nil.
Self-funded retirees supplementary bonus component
(2) An ATO client is qualified for the self-funded retirees supplementary
bonus component of a bonus payment if:
(a) he or she is qualified for the aged persons savings bonus component of
the bonus payment; and
(b) on 1 July 2000, he is aged 65 or more or she is aged
611/2 or more;
and
(c) at least one of the following applies:
(i) he or she did not receive a disqualifying payment at any time during
the period from the start of 1 April 2000 until the end of 1 July
2000;
(ii) he or she received a disqualifying payment during the period from the
start of 1 April 2000 until the end of 30 June 2000, his or her partner died
during that period and he or she is not receiving a disqualifying payment on 1
July 2000;
(iii) he or she received a disqualifying payment during the period from
the start of 1 April 2000 until the end of 1 July 2000 in a circumstance
prescribed by the regulations for the purposes of this subparagraph;
and
(d) his or her adjusted savings and investment income for the qualifying
year, or for either or each of the qualifying years, for which paragraph (1)(c)
is satisfied is more than $1,000; and
(e) the amount of the self-funded retirees supplementary bonus component,
worked out under subsection 43(5), is greater than nil.
The Commissioner must, in accordance with this Part, determine whether or
not a proper claim is to be granted.
(1) The Commissioner must determine that a proper claim is to be granted
if the Commissioner is satisfied that the ATO client is qualified for a bonus
payment under this Part.
(2) The Commissioner must give written notice of the determination to the
ATO client. The notice must:
(a) state that he or she is qualified for a bonus payment; and
(b) specify the qualifying year or qualifying years in respect of which he
or she is so qualified; and
(c) specify the amount of the bonus payment and how it was worked out;
and
(d) state that he
or she may object against the determination in the manner set out in Part IVC of
the Taxation Administration Act 1953.
If the Commissioner determines that a proper claim is not to be granted,
the Commissioner must give written notice of the determination to the ATO
client. The notice must:
(a) state that he or she is not qualified for a bonus payment;
and
(b) state the reasons for the Commissioner’s determination;
and
(c) state that he or she may object against the determination in the
manner set out in Part IVC of the Taxation Administration Act
1953.
Client qualified for bonus payment for 1 qualifying year
(1) If the Commissioner is satisfied that an ATO client is qualified for a
bonus payment in respect of 1 qualifying year, the client is entitled to the
amount of the bonus payment worked out in respect of that year.
Client qualified for bonus payment for both qualifying
years
(2) If the Commissioner is satisfied that an ATO client is qualified for a
bonus payment in respect of both qualifying years:
(a) the Commissioner must work out the amount of the bonus payment in
respect of each qualifying year; and
(b) the client is entitled to:
(i) the higher of those amounts; or
(ii) if those amounts are equal—one of those amounts.
Amount of bonus payment
(3) The amount of an ATO client’s bonus payment in respect of a
qualifying year is:
(a) if he or she is qualified for only the
aged persons savings bonus component of the bonus payment for that
year—the amount of that component; or
(b) if he or she is qualified for both the aged persons savings bonus
component and the self-funded retirees supplementary bonus component of the
bonus payment for that year—the sum of those components.
Aged persons savings bonus component
(4) The aged persons savings bonus component of a bonus payment for a
qualifying year is worked out in accordance with the following table:
|
Amount of aged persons savings bonus component |
||
|---|---|---|
|
Item |
If the ATO client’s taxable income as shown in his or her
assessment for the qualifying year is: |
...the amount of the aged persons savings bonus component is equal
to: |
|
1 |
$20,000 or less |
his or her adjusted savings and investment income for that year, up to a
maximum of $1,000 |
|
2 |
more than $20,000 but less than $30,000 |
(a) his or her adjusted savings and investment income for that year, up to
a maximum of $1,000; less |
Example: For the 1998-1999 income year Malcolm has an
assessed taxable income of $23,000 and adjusted savings and investment income of
$1,500.
Malcolm’s aged persons savings bonus component is
worked out as follows.
Malcolm’s adjusted savings and investment income of
$1,500 exceeds the maximum of $1,000, so only $1,000 is potentially
allowable.
The phasing out fraction of the $1,000 then needs to be
subtracted. The fraction is:
Therefore 3/10 of $1,000 (i.e. $300) needs to be
subtracted. This leaves an aged persons savings bonus component of
$700.
Self-funded retirees supplementary bonus component
(5) The self-funded retirees supplementary bonus component of a bonus
payment for a qualifying year is worked out in accordance with the following
table:
|
Amount of self-funded retirees supplementary bonus
component |
||
|---|---|---|
|
Item |
If the ATO client’s taxable income as shown in his or her
assessment for the qualifying year is: |
...the amount of the self-funded retirees supplementary bonus component
is equal to: |
|
1 |
$20,000 or less |
the amount, up to a maximum of $2,000, by which his or her adjusted savings
and investment income for that year exceeds $1,000 |
|
2 |
more than $20,000 but less than $30,000 |
(a) the amount, up to a maximum of $2,000, by which his or her adjusted
savings and investment income for that year exceeds $1,000; less |
Example: For the 1999-2000 income year Joan has an assessed
taxable income of $24,000 and adjusted savings and investment income of
$5,000.
Joan’s self-funded retirees supplementary bonus
component is worked out as follows.
Joan’s adjusted savings and investment income of
$5,000 exceeds the lower limit of $1,000 by $4,000, but this is only allowable
up to a maximum of $2,000.
The phasing out fraction of the $2,000 then needs to be
subtracted. The fraction is:
Therefore 4/10 of $2,000 (i.e. $800) needs to be
subtracted. This leaves a self-funded retirees supplementary bonus component of
$1,200.
Joan is also entitled to an aged persons savings bonus
component of $600: worked out under subsection (4).
Joan is entitled to a bonus payment of
$1,800.
Bonus payments less than $1 rounded up to $1
(6) If the amount of an ATO client’s bonus payment worked out under
this section is greater than nil and less than $1, the amount is rounded up to
$1.
(7) In this section:
phasing out fraction means the following
fraction:
If the Commissioner determines that an ATO client’s claim for a
bonus payment is to be granted, the Commissioner must, on behalf of the
Commonwealth, make the bonus payment to the client at such time, and in such
manner, as the Commissioner determines.
Note: Under the Income Tax Assessment Act 1997, a
bonus payment is exempt from income tax.
Re-calculation of bonus payment entitlement if assessment
amended
(1) If:
(a) the Commissioner makes a determination under section 41 or 42 (the
original determination) in relation to an ATO client;
and
(b) the Commissioner amends the ATO client’s assessment for a
qualifying year specified in the ATO client’s claim;
the Commissioner must work out under this Part the amount (if any) of the
bonus payment the ATO client would be entitled to as a result of the assessment
being amended.
Circumstances when original bonus payment determination is varied or
revoked
(2) If:
(a) the Commissioner amended the assessment no later than 13 weeks after
notice of the original determination was given to the ATO client (the
qualifying period); or
(b) the Commissioner amended the assessment after the qualifying period as
a result of the ATO client applying for an amendment of the assessment within
that period; or
(c) the Commissioner amended the assessment after the qualifying period
(without the ATO client having applied for an amendment of the assessment within
that period) and as a result of the amendment the ATO client would be entitled
to a lesser bonus payment than under the original determination or would not be
entitled to any bonus payment;
the Commissioner must:
(d) if the original determination was made under section 41 and as a
result of the assessment being amended the ATO client would be entitled to a
different bonus payment than under the determination—vary the
determination to reflect the correct entitlement; or
(e) if the original determination was made under section 41 and as a
result of the assessment being amended the ATO client would not be entitled to
any bonus payment—revoke the determination and make a determination under
section 42 in relation to the ATO client; or
(f) if the original determination was made under section 42 and as a
result of the assessment being amended the ATO client would be entitled to a
bonus payment—revoke the determination and make a determination under
section 41 in relation to the ATO client.
Note 1: Any part of a bonus payment to which the ATO client
is not entitled is recoverable as a debt due to the Commonwealth: see section
49.
Note 2: Any additional bonus payment to which the ATO client
is entitled is payable by the Commissioner to the client under section
44.
Circumstances when original bonus payment determination is not varied or
revoked
(3) If the Commissioner amended the assessment in any other circumstance,
the Commissioner must not vary or revoke the original determination, or make any
new determination in relation to the ATO client, as a result of the
amendment.
Notice of variation
(4) If, under this section, the Commissioner varies a determination under
section 41, the Commissioner must give written notice of the variation to the
ATO client. The notice must:
(a) state the amount of the bonus payment to which he or she is now
entitled; and
(b) state the reasons for the Commissioner varying the determination;
and
(c) state that he or she may object against the variation in the manner
set out in Part IVC of the Taxation Administration Act 1953.
Note: If, under this section, the Commissioner revokes the
original determination and makes a new determination, the Commissioner must give
notice of the new determination: see sections 41 and 42.
(1) If the Commissioner is satisfied, at any time after making a
determination under section 41 in relation to an ATO client, that the ATO
client:
(a) was entitled to a lesser bonus payment than under the determination;
or
(b) was not entitled to any bonus payment;
(otherwise than because of an amendment of an assessment of the ATO client)
the Commissioner must:
(c) in a paragraph (a) case—vary the determination to reflect the
correct entitlement; or
(d) in a paragraph (b) case—revoke the determination and make a
determination under section 42 in relation to the ATO client.
Note: Any part of a bonus payment to which the ATO client is
not entitled is recoverable as a debt due to the Commonwealth: see section
49.
(2) The Commissioner must give written notice of any variation of a
determination under section 41 to the ATO client. The notice must:
(a) state the amount of the lesser bonus payment to which he or she is now
entitled; and
(b) state the reasons for the Commissioner varying the determination;
and
(c) state that he or she may object against the variation in the manner
set out in Part IVC of the Taxation Administration Act 1953.
Note: In a case where the Commissioner revokes the
determination and makes a new determination under section 42, the Commissioner
must give notice of the reasons etc. for this under that
section.
(1) If an ATO client is dissatisfied with:
(a) a determination of the Commissioner under section 41 or 42;
or
(b) a decision of the Commissioner under section 45 or 46 to vary a
determination of the Commissioner under section 41;
the client may object against it in the manner set out in Part IVC of the
Taxation Administration Act 1953.
(2) However, the client must lodge an objection with the Commissioner no
later than 13 weeks after notice of the determination or of the variation was
given to the client.
(3) Subsection (2) has effect despite anything in Part IVC of the
Taxation Administration Act 1953.
The Commissioner must not vary or revoke a determination under section 41
or 42, except as mentioned in section 45 or 46, or where the variation or
revocation takes place in giving effect to an objection under section
47.
(1) The following amounts are recoverable as debts due to the
Commonwealth:
(a) a payment made to an ATO client under this Part to which the client
was not entitled (including because of any variation or revocation of a
determination under this Part);
(b) interest payable under subsection 50(2).
(2) The amounts are recoverable from the ATO client or his or her
estate.
(3) An amount recoverable under subsection (1) is recoverable whether or
not any person has been convicted of an offence relating to the
payment.
(1) If the Commissioner has served on an ATO client from whom an amount is
recoverable under subsection 49(1), or the legal personal representative of such
a client, a notice claiming an amount as a debt due to the Commonwealth
and:
(a) an arrangement for the repayment of the amount has been entered into
between the Commissioner and the client or the client’s legal personal
representative, as the case may be, within the period referred to in subsection
(3), and there has been a default in payment of an amount required to be paid
under the arrangement; or
(b) at the end of the period such an arrangement has not been entered into
and all or part of the amount remains unpaid;
then, from and including the day after the end of the period, interest
becomes payable, by way of penalty, on so much of the amount as from time to
time remains unpaid.
(2) Interest is payable:
(a) at the rate specified in the regulations; or
(b) if no rate is so specified—at the rate of 8% per
annum.
(3) The period for entering into an arrangement under paragraph (1)(a) is
the period of 3 months following the service of the notice under subsection (1),
or such longer period as the Commissioner allows.
(4) Despite subsection (1), in any proceedings instituted by the
Commonwealth for the recovery of an amount due under paragraph 49(1)(b), the
court may order that the interest payable under that paragraph is, and is taken
to have been, so payable from and including a day later than the day referred to
in subsection (1).
(1) The Commissioner may, on behalf of the Commonwealth, make a written
determination:
(a) writing off an amount that a person is required to pay to the
Commonwealth under section 49; or
(b) waiving the right of the Commonwealth to recover from a person the
whole or a part of an amount that the person is required to pay to the
Commonwealth under that section; or
(c) allowing a person who is required to pay an amount to the Commonwealth
under that section to pay that amount by such instalments as are specified in
the determination.
(2) A determination under subsection (1) takes effect according to its
terms:
(a) on the day specified in the determination, being the day on which the
determination is made or any day before or after that day; or
(b) if no day is so specified—on the day on which the determination
is made.
(3) If a determination is made under subsection (1) in relation to a
person, the Commissioner must cause notice of the determination to be served on
the person.
Review by Administrative Appeals Tribunal
(4) Application may be made to the Administrative Appeals Tribunal for
review of a decision by the Commissioner not to make a determination under this
section in relation to an amount.
Note: Under section 27A of the Administrative Appeals
Tribunal Act 1975, the decision-maker must notify persons whose interests
are affected by the making of the decision of their right to have the decision
reviewed. In notifying any such persons, the decision-maker must have regard to
the Code of Practice determined under section 27B of that
Act.
The Commissioner has the general administration of this Part.
(1) A person is guilty of an offence if:
(a) the person uses, makes a record of, or discloses or communicates to
any person, any information that relates to the affairs of another person and
that was acquired by the person in the performance of a function or obligation,
or in the exercise of a power, under this Part; and
(b) the use, making of the record, disclosure or communication was not
carried out in the performance of the function or obligation, or in the exercise
of the power.
Maximum penalty: Imprisonment for 2 years.
Application of the Criminal Code
(2) Chapter 2 of the Criminal Code applies to the offence under
subsection (1).
For
the purposes of section 8K of the Taxation Administration Act 1953, but
not otherwise for the purposes of that Act, this Part is a taxation
law.
A bonus payment under Part 2, 3 or 4 is taken not to be income for the
purposes of:
(a) the Social Security Act 1991; and
(b) the Veterans’ Entitlements Act 1986.
The Consolidated Revenue Fund is appropriated for the purpose of making
payments under this Act.
The Governor-General may make regulations prescribing matters:
(a) required or permitted by this Act to be prescribed; or
(b) necessary or convenient to be prescribed for carrying out or giving
effect to this Act.