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This is a Bill, not an Act. For current law, see the Acts databases.
1996
The Parliament of
the
Commonwealth of
Australia
HOUSE OF
REPRESENTATIVES
Presented and read a first
time
Taxation Laws
Amendment (Private Health Insurance Incentives) Bill
1996
No. ,
1996
(Treasury)
A Bill
for an Act to amend the Income Tax Assessment Act 1936 and the Income
Tax Assessment Act 1996, and for related
purposes
9618040—880/25.11.1996—(180/96) Cat.
No. 96 7230 3 ISBN 0644 497297
Contents
Income Tax Assessment Act
1936 6tlaphh1.html
Income Tax Assessment Act
1936 6tlaphh1.html
Income Tax Assessment Act 1996 6tlaphh1.html
A Bill for an Act to amend the Income Tax Assessment
Act 1936 and the Income Tax Assessment Act 1996, and for related
purposes
The Parliament of Australia enacts:
This Act may be cited as the Taxation Laws Amendment (Private Health
Insurance Incentives) Act 1996.
(1) Subject to this section, this Act commences on the day on which it
receives the Royal Assent.
(2) Schedule 1 (other than item 2) commences on 1 July 1997.
(3) Item 2 of Schedule 1 is taken to have commenced on 1 July
1994.
(4) Schedule 2 commences on 1 July 1997, immediately after the
commencement of the Income Tax Assessment Act 1996.
Subject to section 2, each Act that is specified in a Schedule to this
Act is amended or repealed as set out in the applicable items in the Schedule
concerned, and any other item in a Schedule to this Act has effect according to
its terms.
Income
Tax Assessment Act 1936
1 Paragraph 221YCAA(2)(c)
After “Medicare Levy Act 1986”, insert “(other
than sections 8B, 8C, 8D, 8E, 8F and 8G)”.
2 Subsection 251S(1A)
Omit “section 159SB”, substitute “section
159SA”.
3 Section 251T
After “levy”, insert “(other than an increase in the levy
payable under section 8B, 8C, 8D, 8E, 8F or 8G of the Medicare Levy Act
1986)”.
Note: The heading to section 251T is altered by inserting
“(other than certain levy increases)” after
“Levy”.
4 After section 251U
Insert:
(1) This section applies to a person during a period if, apart from this
section, another person would be taken under subsection 251R(4), (5), (6B), (6C)
or (6D) not to have been a dependant of the first-mentioned person during the
period.
(2) For the purposes of working out the amount of the increase in the levy
(if any) payable by:
(a) the first-mentioned person under section 8B, 8C or 8D of the
Medicare Levy Act 1986; or
(b) a trustee under section 8E, 8F or 8G of that Act in relation to a
share of the net income of the trust estate to which the first-mentioned person
is presently entitled;
subsection 251R(4), (5), (6B), (6C) or (6D), as the case requires, does not
apply to the other person.
(1) This section applies to a person, whether or not the person is a
person to whom section 251V applies, during a period if, apart from this
section, the person would be taken under subsection 251U(3) to be a
prescribed person during one-half of the period.
(2) For the purposes of working out the amount of the increase in the levy
(if any) payable by:
(a) the person under section 8B, 8C or 8D of the Medicare Levy Act
1986; or
(b) a trustee under section 8E, 8F or 8G of that Act in relation to a
share of the net income of the trust estate to which the person is presently
entitled;
the person is taken not to be a prescribed person during the whole of the
period.
5 Application
The amendments made by this Schedule (other than item 2) apply to
assessments in respect of income for the 1997-98 year of income and all later
years of income.
Income
Tax Assessment Act 1936
1 After paragraph 16(4)(fa)
Insert:
(fb) the Health Insurance Commission for the purpose of the administration
of the Private Health Insurance Incentives Act 1996;
2 At the end of paragraph
26(b)
Add “; and”.
3 At the end of paragraphs 26(e) to
(jb)
Add “and”.
4 At the end of section 26
Add:
; and (m) an amount paid under section 8-3 of the Private Health
Insurance Incentives Act 1996 to a health fund (within the meaning of that
Act).
5 After subsection
221YCAA(2)
Insert:
(2A) For the purposes of paragraph (2)(m), a tax offset under
section 61-305 of the Income Tax Assessment Act 1996 is not to be
taken to be a rebate.
6 After section 264A
Insert:
(1) The Commissioner may, by notice in writing, require a health fund to
provide information about each person covered by a private health insurance
policy at any time during a financial year.
(2) The information that the Commissioner may require the health fund to
provide is as follows:
(a) the name, address and date of birth of each such person;
(b) the fund membership number of the policy;
(c) whether the policy concerned covers only one person or covers more
than one person;
(d) the name, address and date of birth of the person covered by the
policy whom the health fund treats as the contributor in respect of the
policy;
(e) whether any of the persons covered by the policy are dependent
children;
(f) the name, address and date of birth of any person who is a partner of
a person covered by the policy;
(g) the name, address and date of birth of any person who paid premiums
under the policy;
(h) whether the policy provides hospital cover or ancillary
cover;
(i) the date on which the policy was issued;
(j) whether the policy has terminated, and, if it has, the date on which
it terminated;
(k) the amount (if any) by which the premium in respect of the policy has
been reduced for that financial year because of the operation of the Private
Health Insurance Incentives Act 1996.
(3) The information required under subsection (2) is to be
supplied:
(a) in a form (including an electronic form) approved by the Commissioner;
and
(b) within the period specified by the Commissioner.
(4) In this section, the following terms have the same meanings as in the
Private Health Insurance Incentives Act 1996:
|
ancillary cover; |
|---|
|
dependent child; |
|
health fund; |
|
hospital cover; |
|
partner; |
|
private health insurance policy. |
Income
Tax Assessment Act 1996
7 Section 13-1 (table, after item headed
“primary production”)
Insert:
|
private health insurance |
|
|
.......... |
Subdivision |
8 After section 43-260
Insert:
[The next heading is the heading to Part 2-20.]
[The next Division is Division 61.]
[The next Subdivision is Subdivision 61-G.]
You can choose to claim a tax offset for premiums paid under private health
insurance policies, instead of having premiums reduced under the Private
Health Insurance Incentives Act 1996.
Operative provisions
61-305 Entitlement to the private health insurance tax
offset
61-310 Amount of the private health insurance tax
offset
61-315 Priority between different taxpayers
61-320 Priority agreements
Operative provisions
(1) You are entitled to a *tax offset for
an income year in respect of premiums paid under a private health insurance
policy (within the meaning of the Private Health Insurance Incentives Act
1996) if:
(a) the policy was one in respect of which you were eligible under
Division 3 of the Private Health Insurance Incentives Act 1996 to
participate in the incentives scheme (within the meaning of that Act);
or
(b) the policy was one in respect of which another person was so eligible,
but your taxable income for that year was required by subsection 3-3(2) or
3-4(2) of that Act to be taken into account for the purpose of determining
whether the other person was so eligible.
(2) You are also entitled to that *tax
offset if:
(a) you are a trustee who is liable to be assessed under section 98
of the Income Tax Assessment Act 1936 in respect of a share of the net
income of a trust estate; and
(b) the beneficiary who is presently entitled to the share of the income
of the trust estate would be entitled to the tax offset because of subsection
(1) if his or her taxable income for the income year were limited to that
share.
(3) However:
(a) you are not entitled to the *tax
offset in respect of any premiums that were reduced under section 5-1 of the
Private Health Insurance Incentives Act 1996; and
(b) you are not entitled to the tax offset in respect of any premiums in
respect of which another person’s entitlement to the tax offset has
priority under section 61-315; and
(c) if, on a day during the income year, the policy ceased to be a
dependent child policy (within the meaning of section 5-4 of that Act)—you
are not entitled to the tax offset in respect of premiums to the extent that
they relate to a part of the income year occurring after that day.
(1) The amount of the *tax offset
is:
(a) if the premiums in respect of which you are entitled to the tax offset
cover the whole of the income year—the annual incentive amount for the
private health insurance policy in question; or
(b) if those premiums cover only part of the income year—the amount
worked out as follows:
(2) In subsection (1):
annual incentive amount means the annual incentive amount for
the private health insurance policy under section 5-3 of the Private Health
Insurance Incentives Act 1996.
(3) However, if 2 or more persons are entitled to the
*tax offset in respect of those premiums, each
person having made payments in respect of those premiums, the amount of the tax
offset is the amount worked out as follows:
(4) For the purposes of subsection (3), a payment made jointly in respect
of a premium by 2 or more persons is taken to be a separate payment, made by
each of them, of an amount equal to the joint payment divided by the number of
persons who made it.
(5) For the purposes of subsection (3), if:
(a) 2 or more persons are entitled to the
*tax offset in respect of those premiums;
and
(b) payments have been made in respect of those premiums by another person
who is not entitled to the tax offset;
each of the persons entitled to the tax offset is taken to have made a
payment in respect of those premiums of an amount equal to the amount of the
payments made by the other person divided by the number of persons entitled to
the tax offset.
(1) This section establishes the priority of entitlements to the
*tax offset if more than one person would,
apart from paragraph 61-305(3)(b), be entitled to the tax offset in respect of
the same premiums paid under a private health insurance policy (within the
meaning of the Private Health Insurance Incentives Act 1996).
Note: See paragraph 61-305(3)(b) for the significance of
priority of entitlements.
(2) All of the persons who would, apart from paragraph 61-305(3)(b),
be entitled to the *tax offset in respect of
those premiums may make an agreement (a priority agreement) in
respect of the income year specifying one of them as the person whose
entitlement is to have priority.
Note: Section 61-320 contains further provisions about
priority agreements.
(3) That person’s entitlement in respect of those premiums has
priority over the entitlements of all of the others.
(4) If:
(a) a *priority agreement is not made in
respect of the income year; and
(b) one of the persons who would, apart from paragraph 61-305(3)(b), be
entitled to the *tax offset in respect of those
premiums has made payments in respect of those premiums; and
(c) another of the persons who would, apart from paragraph 61-305(3)(b),
be entitled to the tax offset in respect of those premiums has not made payments
in respect of those premiums;
the entitlement of the person who made those payments has priority over the
entitlement of the person who has not.
(5) If:
(a) a *priority agreement is not made in
respect of the income year; and
(b) none of the persons who would, apart from paragraph 61-305(3)(b), be
entitled to the *tax offset in respect of those
premiums has made payments in respect of those premiums;
the entitlement of the contributor in respect of the private health
insurance policy has priority over the entitlement of each person other than the
contributor.
(6) In subsection (5):
contributor means the person who is treated as the
contributor by the health fund (within the meaning of the Private Health
Insurance Incentives Act 1996) that issued the private health
insurance policy.
(7) Despite paragraph 61-305(3)(b) and subsections (3), (4) and (5) of
this section, the entitlement to the *tax
offset of either of the following persons in respect of those
premiums:
(a) a trustee who is liable to be assessed under section 98 of the
Income Tax Assessment Act 1936 in respect of a share of the net income of
a trust estate;
(b) the beneficiary who is presently entitled to the share of the income
of the trust estate;
is not affected by the other person’s entitlement to the tax offset
in respect of those premiums having priority.
(1) A *priority agreement has no effect
unless it is made on or before:
(a) the day on which the first *income
tax return of any of the persons who made the agreement was lodged for the
income year in respect of which the agreement was made; or
(b) such later day as the Commissioner allows.
(2) A *priority agreement has no effect,
and is taken never to have had effect, if none of the persons who made the
agreement retain the agreement for the period of 5 years starting on the day on
which the agreement was made.
(3) If the *priority agreement is lost or
destroyed and the Commissioner is satisfied that one of the persons who made the
agreement has a document (the substitute priority agreement)
that:
(a) is a copy of the priority agreement; or
(b) properly records all the matters set out in the priority agreement and
was in existence when the priority agreement was lost or destroyed;
the substitute priority agreement is taken, for the purposes of this
Subdivision, to be, and to have been at all times after the priority agreement
was lost or destroyed, the priority agreement.
(4) If:
(a) the *priority agreement is lost or
destroyed; and
(b) the Commissioner is satisfied that the loss or destruction occurred
because of circumstances beyond the control of the persons who made the
agreement; and
(c) subsection (3) does not apply;
the agreement is not affected, and is taken never to have been affected, by
subsection (2).
(5) Section 170 of the Income Tax Assessment Act 1936 does not
prevent the amendment of an assessment at any time for the purposes of giving
effect to this section.
9 Subsection 995-1(1)
Insert:
priority agreement has the meaning given by
subsection 61-315(2).
10 Application
(1) The amendments of the Income Tax Assessment Act 1936 apply to
assessments in respect of income for the 1997-98 year of income and all later
years of income.
(2) The amendments of the Income Tax Assessment Act 1996 apply to
assessments in respect of income for the 1997-98 income year and all later
income years.