Commonwealth Numbered Acts

TAXATION LAWS AMENDMENT ACT (No. 5) 1990 No. 135 of 1990 - SECT 25

25. Section 221YDB of the Principal Act is amended:

   (a)  by omitting subsection (1) and substituting the following subsections:

"(1) Where both of the following conditions are satisfied in relation to a
taxpayer and in relation to a year of income:

   (a)  either of the following conditions is satisfied:

   (i)  if the taxpayer is a section 221YAB taxpayer in relation to the year
        of income - the amount of the taxpayer's estimated taxable income is
        less than 90% of the amount of the taxpayer's taxable income;

   (ii) in any other case - the amount of the taxpayer's estimated taxable
        income, reduced by the amount (if any) representing salary or wages
        that is included in that estimated taxable income, is less than 90% of
        the amount remaining after deducting from the taxpayer's taxable
        income the amount of any assessable income of the taxpayer that
        consists of salary or wages;

   (b)  the taxpayer is not liable to pay instalments of provisional tax in
        respect of the year of income; the taxpayer is liable to pay to the
        Commissioner additional tax, by way of penalty, equal to 20% of the
        lesser of:

   (c)  the amount by which the tax payable in respect of the taxable income
        exceeds the amount of provisional tax payable in respect of the
        estimated taxable income; or

   (d)  the amount by which the provisional tax that would, apart from section
        221YDA, be payable in respect of the taxable income exceeds the amount
        of provisional tax payable in respect of the estimated taxable income.

"(1AAA) Where all of the following conditions are satisfied in relation to a
taxpayer and in relation to a year of income:

   (a)  the taxpayer is a section 221YAB taxpayer in relation to the year of
        income;

   (b)  the taxpayer is not liable to pay instalments of provisional tax in
        respect of the year of income;

   (c)  the amount of the taxpayer's estimated taxable income is not less than
        90% of the amount of the taxpayer's taxable income;

   (d)  the amount of the taxpayer's estimated PAYE deductions exceeds 110% of
        the amount of the deductions which have been made from the taxpayer's
        salary or wages during the year of income in accordance with sections
        221C and 221D; the taxpayer is liable to pay to the Commissioner
        additional tax, by way of penalty, equal to 20% of whichever of the
        following is the least:

   (e)  the amount by which the amount of deductions made from the taxpayer's
        salary or wages during the year of income in accordance with sections
        221C and 221D is less than whichever is the lesser of the following
        amounts:

   (i)  the estimated PAYE deductions;

   (ii) so much of the amount of the estimated PAYE deductions as is estimated
        by the Commissioner, under paragraph 221YDA (2) (b), to represent
        deductions that have been, and will be, made in accordance with
        sections 221C and 221D;

   (f)  the amount by which the tax payable in respect of the taxable income
        exceeds the amount of provisional tax payable in respect of the
        estimated taxable income;

   (g)  the amount by which the provisional tax that would, apart from section
        221YDA, be payable in respect of the taxable income exceeds the amount
        of provisional tax payable in respect of the estimated taxable
        income.";
(b) by inserting in subsection (1A) "or (1AAA)" after "subsection (1)";

   (c)  by omitting from paragraph (1A) (b) "reference in paragraph (a) of
        that subsection" and substituting "references in paragraphs (1) (c)
        and (1AAA) (f)";

   (d)  by omitting paragraph (1aa) (b) and substituting the following
        paragraph:
  "(b)   either of the following conditions is satisfied:


   (i)  if the taxpayer is a section 221YAB taxpayer in relation to the year
        of income - the amount of the taxpayer's estimated taxable income is
        less than 90% of the amount of the taxpayer's taxable income;

   (ii) in any other case - the amount of the taxpayer's estimated taxable
        income, reduced by the amount (if any) representing salary or wages
        that is included in that estimated taxable income, is less than 90% of
        the amount remaining after deducting from the taxpayer's taxable
        income the amount of any assessable income of the taxpayer that
        consists of salary or wages;";

   (e)  by inserting after subsection (1AA) the following subsection:

"(1ABA) Where all of the following conditions are satisfied in relation to a
taxpayer and in relation to a year of income:

   (a)  the taxpayer is a section 221YAB taxpayer in relation to the year of
        income;

   (b)  an instalment of provisional tax for the year of income was calculated
        by reference to:

   (i)  the amount of the taxpayer's estimated taxable income for the year of
        income as shown in an instalment estimate; or

   (ii) an application of subsection 221YDA (4) in relation to the taxpayer's
        estimated taxable income for the year of income as shown in an
        instalment estimate;

   (c)  the taxpayer's estimated taxable income is not less than 90% of the
        taxpayer's taxable income;

   (d)  the amount of the taxpayer's estimated PAYE deductions, as shown in
        the instalment estimate, exceeds 110% of the amount of the deductions
        which have been made from the taxpayer's salary or wages during the
        year of income in accordance with sections 221C and 221D; additional
        tax, by way of penalty, in respect of the penalty period, is due and
        payable by the taxpayer to the Commissioner at the rate of 20% per
        annum on whichever is the lesser of the following amounts:

   (e)  the amount by which the instalment is less than the amount that would
        have been the amount of the instalment if:

   (i)  the estimated PAYE deductions had been equal to the amount of the
        deductions which were made from the taxpayer's salary or wages during
        that year of income in accordance with sections 221C and 221D; and

   (ii) the Commissioner had accepted that estimate for the purposes of
        paragraph 221YDA (2) (b); and

   (iii) subsection 221YDA (4) had not applied;

   (f)  the amount by which the instalment is less than the amount calculated
        using the formula:
(Relevant        Relevant )

(amount      X  percentage)    - Previous instalments
`Relevant amount' means the lesser of: where:

   (i)  the amount that would have been the applicable provisional tax amount
        in relation to the instalment if no instalment estimate had been
        furnished by the taxpayer in respect of the year of income; or

   (ii) the amount of tax payable by the taxpayer in respect of the taxable
        income of the year of income reduced by:

                (A)  where the income of the taxpayer of the year of income
                     includes salary or wages and sub-subparagraph (C) does
                     not apply - the amount of the deductions made from that
                     salary or wages in accordance with sections 221C and
                     221D; and

                (B)  where the income of the taxpayer of the year of income
                     includes prescribed payments and sub-subparagraph (C)
                     does not apply - the amount of any deductions made under
                     Division 3A from those prescribed payments; and

                (C)  where the income of the taxpayer of the year of income
                     includes salary or wages and prescribed payments - the
                     amounts that, apart from this sub-subparagraph, would be
                     applicable under sub-subparagraphs (A) and (B) in
                     relation to the salary or wages and the prescribed
                     payments; `Relevant percentage' means the relevant
                     percentage; `Previous instalments' means the amount of
                     any previous instalments of provisional tax for the year
                     of income.";
(f) by inserting in subsection (1AB) "or (1ABA)" after "subsection (1AA)";
(g) by inserting in subsection (1AC) "or (1ABA)" after "(1AA)";

   (h)  by omitting from subsection (1B) "or (1AA)" and substituting ",
        (1AAA), (1AA) or (1ABA)";

   (j)  by omitting from subsection (2) "or (1AA)" and substituting ", (1AAA),
        (1AA) or (1ABA)";

   (k)  by omitting subsection (4) and substituting the following subsection:

"(4) Where the Commissioner is satisfied that additional tax under this
section became payable by a taxpayer in relation to provisional tax, or an
instalment of provisional tax, for a year of income because of circumstances
where both of the following conditions are satisfied:

   (a)  the circumstances affected:

   (i)  the taxpayer's taxable income of that year of income; or

   (ii) the amount of the deductions made from the taxpayer's salary or wages
        during that year of income in accordance with sections 221C and 221D;

   (b)  the taxpayer was not aware of the circumstances earlier than the time
        at which the taxpayer was required or permitted by section 221YDA to
        furnish a statement of estimated taxable income; the Commissioner may
        remit the whole or a part of the additional tax.".