Source: https://www.legislation.gov.au/Details/F2018L00115
Timestamp: 2019-06-26 00:21:09
Document Index: 219139260

Matched Legal Cases: ['art 2', 'art 3', 'art 4', 'art 5', 'art 2', 'art 2', 'art 3', 'art 3', 'art 4', 'art 4', 'art 5', 'art 6', 'art 6', 'art 2', 'art 3', 'art 4', 'art 6']

Details: F2018L00115
- F2018L00115
These rules provide the administrative framework for the issue of certificates, including provisional certificates, for the Location Offset under the Income Tax Assessment Act 1997.
Tabled HR 15-Feb-2018
F2018L00115
5 Objects of Rules
Part 2—Provisional certificates for location offset
Part 3—Certificates for location offset
Part 4—Expenditure statements and foreign currency statements
Part 5—Audit requirements
Schedule 1—Information and documents for an application for a provisional certificate
Schedule 2—Information and documents for an application for a certificate for the location offset
I, Mitch Fifield, Minister for the Arts, make the following instrument.
Dated 11 February 2018
5 Objects of Rules....................................................................................................................... 1
6 Interpretation............................................................................................................................ 1
Part 2—Provisional certificates for location offset 3
7 Definition for Part 2................................................................................................................. 3
8 Application for provisional certificate....................................................................................... 3
9 Form of application for provisional certificate.......................................................................... 3
10 Delivery of application for provisional certificate................................................................... 4
11 Board to consider application for provisional certificate......................................................... 4
12 Board may request additional information from applicant...................................................... 5
13 Refusal to issue provisional certificate.................................................................................... 5
14 Notice of refusal to issue provisional certificate..................................................................... 6
15 Issue of provisional certificate................................................................................................ 6
16 Content of provisional certificate............................................................................................ 6
17 Effect of provisional certificate............................................................................................... 6
Part 3—Certificates for location offset 7
18 Definition for Part 3............................................................................................................... 7
19 Form of application for certificate for the location offset........................................................ 7
20 Delivery of application for certificate for the location offset................................................... 8
21 Board to consider application for certificate for the location offset and other information...... 8
22 Board may request additional information from applicant...................................................... 9
23 Board to advise Arts Minister.............................................................................................. 10
Part 4—Expenditure statements and foreign currency statements 11
24 Definition for Part 4............................................................................................................. 11
25 Expenditure statements for provisional certificates............................................................... 11
26 Expenditure statements for certificates for the location offset............................................... 12
27 Foreign currency statement for certificates for the location offset......................................... 13
Part 5—Audit requirements 14
28 Conduct of audit................................................................................................................... 14
Part 6—Transitional provisions 15
29 Definition for Part 6............................................................................................................. 15
30 Application of the 2008 rules............................................................................................... 15
Schedule 1—Information and documents for an application for a provisional certificate 16
Part A—Information to be included in an application for a provisional certificate 16
Division 1—Information about the applicant 16
Division 2—Information about the film 17
Division 3—Other information 19
Part B—Documents to be attached to an application for a provisional certificate 20
Schedule 2—Information and documents for an application for a certificate for the location offset 21
Part A—Information to be included in an application for a certificate for the location offset 21
Division 1—Information about the applicant 21
Division 2—Information about the film 22
Division 3—Other information 24
Part B—Documents to be attached to an application for a certificate for the location offset 25
Schedule 3—Repeals 26
Location Offset Rules 2008 26
This instrument is the Location Offset Rules 2018.
This instrument commences the day after this instrument is registered.
This instrument is made under subsections 376-260(2) and (3) of the Income Tax Assessment Act 1997.
(a) to provide for the issue of provisional certificates in relation to the location offset (see subsection 376‑260(2) of the Act); and
(b) to specify how applications for certificates (including provisional certificates) in relation to the location offset are to be made (see subsection 376‑260(3) of the Act).
application for a certificate for the location offset means an application made under subsection 376‑230(1) of the Act.
Board has the meaning given by rule 7 of the Film Certification Advisory Board Rules 2018.
independent line producer means a person who, in the Board’s opinion:
(a) has recent relevant experience in film production management; and
(b) is independent of the company in relation to whom he or she is asked, under subrule 11(3) or 21(3), to provide a report.
location offset means the tax offset mentioned in subsection 376‑10(1) of the Act.
provisional certificate means a certificate issued by the Board under rule 15.
Note: A number of expressions used in this instrument are defined in section 995-1of the Act, including the following:
(a) arm’s length;
(b) arrangement;
(d) Australian resident;
(e) completed;
(g) make;
(h) permanent establishment;
(i) qualifying Australian production expenditure.
(2) For the purposes of this instrument, if a company (the incoming company) takes over the making of a film from another company (the outgoing company), any activities carried out, or arrangements made, by the outgoing company in relation to the film are taken to have been carried out or made by the incoming company in relation to the film.
7 Definition for Part 2
8 Application for provisional certificate
A company may apply to the Board for a provisional certificate for the location offset if:
(ii) is a foreign resident who intends to establish a permanent establishment in Australia; or
(iii) is a foreign resident that has a permanent establishment in Australia and has an ABN; and
(i) carrying out, or is making the arrangements for the carrying out of, all the activities in Australia that are necessary for the making of the film; or
(ii) developing the film prior to the establishment of a production company.
9 Form of application for provisional certificate
(b) include the information specified in clauses 1.1 to 2.13 of Part A of Schedule 1; and
(2) If the film is a television series, the application must also include the information specified in clauses 2.14 to 2.20 of Part A of Schedule 1.
(4) The following documents must be attached to the application:
(b) an expenditure statement, prepared in accordance with rule 25, for the estimated qualifying Australian production expenditure on the film.
(5) If expenditure incurred in producing material for use in publicising or otherwise promoting the film is claimed as estimated qualifying Australian production expenditure by the applicant under item 3 of the table in subsection 376‑150(1) of the Act, either of the following must be attached to the application:
(a) evidence that the copyright in the material is held by an Australian resident; or
(b) if such evidence is not available, a statement of assurance from the applicant that the copyright in the material will be held by an Australian resident.
10 Delivery of application for provisional certificate
An application for a provisional certificate for the location offset must be sent to the Arts Department.
11 Board to consider application for provisional certificate
(2) For paragraph (1)(a), in considering the application, the Board:
(iii) any additional information provided by the applicant under rule 12;
(3) Without limiting paragraph (2)(a), the Board may ask an independent line producer to provide a written report to the Board about any matter that is relevant to whether a condition set out in subsection 376‑20(2), (3) or (5) of the Act will be met or is likely to be met.
(b) whether specific items claimed in the applicant’s expenditure statement are reasonably attributable to the estimated qualifying Australian production expenditure on the film;
(5) If the Board intends to use information or advice from a third party to support a decision to refuse to issue a provisional certificate for the location offset to an applicant, the Board must give the applicant an opportunity to comment on the substance of that information or advice.
(b) give the applicant an opportunity to make a written submission to the Board in response to the report.
(7) If under subrules (5) or (6), the applicant is provided with an opportunity to comment on the substance of information or advice, or to make written submissions to the Board in response to a report, the applicant has 28 days from the day they are notified of the opportunity to provide a response.
(8) At the request of the applicant, the Board may extend the period in which the applicant is to provide a response.
(9) If an applicant does not provide a response within the 28 days, or any extended period under subrule (8), the Board may refuse to issue a provisional certificate to the applicant.
12 Board may request additional information from applicant
(1) If, in the opinion of the Board, it requires additional information in order to decide whether or not to issue a provisional certificate for the location offset, the Board may ask the applicant, in writing, to provide that information to the Board.
13 Refusal to issue provisional certificate
The Board may refuse to issue a provisional certificate for the location offset for a film if it is not satisfied that the conditions set out in subsections 376‑20(2), (3) and (5) of the Act will be met, or are likely to be met, if the film is completed in accordance with the information supplied in the application.
Note: The Board may refuse to issue a provisional certificate on other grounds. For example, the Board may refuse to issue a provisional certificate under subrule 11(9) where the applicant does not provide additional information within the notification period, or extended notification period
14 Notice of refusal to issue provisional certificate
15 Issue of provisional certificate
(1) The Board must issue a provisional certificate for the location offset for a film to the applicant if it is satisfied that the conditions set out in subsections 376‑20(2), (3) and (5) of the Act will be met, or are likely to be met, if the film is completed in accordance with the information supplied in the application.
16 Content of provisional certificate
(1) A provisional certificate must state that the Board is satisfied that the conditions set out in subsections 376‑20(2), (3) and (5) of the Act will be met, or are likely to be met, if the film is completed in accordance with:
(2) A provisional certificate must also state that it:
17 Effect of provisional certificate
18 Definition for Part 3
19 Form of application for certificate for the location offset
(b) include the information specified in clauses 1.1 to 2.15 and Division 3 of Part A of Schedule 2; and
(2) If the film is a television series, the application must also include the information specified in clauses 2.16 to 2.22 of Part A of Schedule 2.
(c) an expenditure statement, prepared in accordance with rule 26, for the estimated qualifying Australian production expenditure on the film;
(d) an auditor’s statement that:
(i) includes an audited qualifying Australian production expenditure figure; and
(ii) includes a statement that the audit was conducted in compliance with rule 28; and
(iii) is signed by a person who:
(e) if the expenditure statement contains an amount of estimated qualifying Australian production expenditure that has been translated into Australian currency using the special translation rule in item 9 or 9B of the table in subsection 960‑50(6) of the Act—a foreign currency statement, prepared in accordance with rule 27.
(4) If expenditure incurred to acquire copyright, or a licence in relation to copyright, in a pre‑existing work for use in the film is claimed, by the applicant, as estimated qualifying Australian production expenditure under item 2 of the table in subsection 376‑150(1) of the Act, the following documents must also be attached to the application:
(5) If expenditure is claimed, by the applicant, as estimated qualifying Australian production expenditure under item 3 of the table in subsection 376‑150(1) of the Act because it was incurred in producing material for use in publicising or otherwise promoting the film, the following documents must also be attached to the application:
(6) If expenditure is claimed, by the applicant, as estimated qualifying Australian production expenditure under item 4 of the table in subsection 376‑150(1) of the Act because it was incurred in producing audio or visual content for the film, the following documents must also be attached to the application:
20 Delivery of application for certificate for the location offset
An application for a certificate for the location offset must be sent to the Arts Department.
21 Board to consider application for certificate for the location offset and other information
(iii) any additional information provided by the applicant under rule 22;
(3) Without limiting paragraph (2)(a), the Board may ask an independent line producer to provide a written report to the Board about any matter that is relevant to whether a condition set out in subsection 376‑20(2), (3) or (5) of the Act has been met.
(5) If the Board intends to use information or advice from a third party to support advice to the Arts Minister not to issue a certificate for the location offset to an applicant, the Board must give the applicant an opportunity to comment on the substance of that information or advice.
(9) If an applicant does not provide a response within the 28 days, or any extended period under subrule (8), the Board may proceed to advise the Arts Minister in accordance with rule 23.
22 Board may request additional information from applicant
(6) If an applicant does not provide the additional information within the notification period, or within the notification period as extended under subrule (5), the Board may proceed to advise the Arts Minister in accordance with rule 23.
23 Board to advise Arts Minister
(1) For paragraph 21(1)(b), if the Arts Minister has asked the Board to advise whether to issue a certificate for the location offset to an applicant, the Board must advise the Arts Minister, in writing:
(a) whether the Board is satisfied that the conditions set out in subsections 376‑20(2), (3) and (5) of the Act are met in relation to the application, assuming, as far as is practicable, that:
(b) whether or not to issue a certificate for the location offset to the applicant.
(b) not to issue a certificate for the location offset to an applicant;
24 Definition for Part 4
25 Expenditure statements for provisional certificates
(1) For paragraph 9(4)(b), an expenditure statement for a provisional certificate for the location offset must comply with subrules (2) to (7).
(i) item 4 of the table in subsection 376‑150(1) of the Act (expenditure incurred in producing additional content); or
(ii) an item of the table in subsection 376‑165(1) of the Act; and
(c) specify any expenditure incurred by an outgoing company.
(3) The expenditure statement must include a statement of the estimated qualifying Australian production expenditure on the film.
(4) The expenditure statement must also include:
(5) An amount in an expenditure statement must be expressed in Australian currency.
(6) For the purposes of an expenditure statement, an amount in foreign currency that is relevant for a purpose mentioned in column 2 of item 9 of the table in subsection 960‑50(6) of the Act must be translated into Australian currency using the special translation rule in that item as if:
(b) if principal photography or the production of animated images (as applicable) has not commenced at the time that the expenditure statement is prepared—a reference to the exchange rate applicable at the time when principal photography commences or production of the animated image commences is a reference to an exchange rate estimated by the applicant.
(7) If an expenditure statement includes an amount in foreign currency that has been translated into Australian currency using the special translation rule in item 9 of the table in subsection 960‑50(6) of the Act, as applied in accordance with subrule (6), the expenditure statement must also include the exchange rate, or estimated exchange rate, used to translate the amount.
26 Expenditure statements for certificates for the location offset
(1) For paragraph 19(3)(c), an expenditure statement for a certificate for the location offset must comply with subrules (2) to (6).
(6) For the purposes of an expenditure statement, an amount in foreign currency that is relevant for a purpose mentioned in column 2 of item 9 or 9B of the table in subsection 960‑50(6) of the Act must be translated into Australian currency using the special translation rule in the relevant item as if a reference in that item to qualifying Australian production expenditure were a reference to estimated qualifying Australian production expenditure.
27 Foreign currency statement for certificates for the location offset
For paragraph 19(3)(e), a foreign currency statement for a certificate for the location offset must set out:
(b) for a foreign expenditure amount that is to be translated into Australian currency using the special translation rule in item 9 of the table in subsection 960‑50(6) of the Act, as applied in accordance with subrule 26(6) (an item 9 foreign expenditure amount):
(c) for a foreign expenditure amount that is to be translated into Australian currency in accordance with the special translation rule in item 9B of the table in subsection 960‑50(6) of the Act, as applied in accordance with subrule 26(6) (an item 9B foreign expenditure amount):
28 Conduct of audit
A company that has applied, or that intends to apply, for a certificate for the location offset must ensure that an audit that is conducted for paragraph 19(3)(d) is conducted in accordance with all applicable accounting standards, including any standards relating to the independence of auditors.
29 Definition for Part 6
2008 rules means the Location Offset Rules 2008, as in force immediately before the commencement of this instrument.
30 Application of the 2008 rules
The 2008 rules continue to apply in relation to:
(a) an application for a provisional certificate for the location offset made under rule 6 of the 2008 rules; or
(b) a provisional certificate for the location offset issued under rule 13 of the 2008 rules; or
(c) an application for a certificate for the location offset made under rule 17 of the 2008 rules;
before the commencement of this instrument.
Part A—Information to be included in an application for a provisional certificate
Division 1—Information about the applicant
1.3 For a company that is incorporated in a State or Territory—the State or Territory in which the company is incorporated.
1.4 For a company that is not incorporated in a State or Territory—the place in which the company is incorporated.
1.6 For a company that is a foreign resident—details of the company’s permanent establishment in Australia.
Note: The Board must be satisfied that the applicant will, or is likely to, carry out, or make the arrangements for the carrying out of, all the activities in Australia that were necessary for the making of the film (see subrule 15(1) and paragraph 376‑20(5)(c) of the Act).
Division 2—Information about the film
Note: See paragraph 376‑20(2)(c) of the Act.
Note: If the film is a television series, a synopsis of the series must be provided.
Note: If a film is a television series the running time (minutes) and commercial hours must be provided.
(a) for an animated film—the production of animated images; or
(b) otherwise—principal photography on the film.
(i) a certificate for the PDV offset for the film under subsection 376‑230(2) of the Act; or
(ii) a certificate for the producer offset for the film under subsection 376‑230(3) of the Act; or
2.12 Whether the applicant is likely to incur expenditure on the film as a foreign resident.
2.14 Whether or not the television series is predominantly a digital animation or other animation.
2.15 Estimated length of time, in months, that it will take for:
(a) for a television series that is predominantly a digital animation or other animation—the series to be made, excluding pre‑production activities; or
(b) otherwise—principal photography to take place.
2.16 Estimated number of episodes in the series.
2.17 Estimated duration of the series, in hours.
2.18 Estimated qualifying Australian production expenditure for the series.
2.19 Estimated qualifying Australian production expenditure on the series (in Australian dollars) divided by the estimated running time of the series (in hours).
2.20 Details of any expenditure for the pilot episode (if any) that is estimated qualifying Australian production expenditure.
Division 3—Other information
Part B—Documents to be attached to an application for a provisional certificate
(a) that it is made for rule 9; and
(a) for an applicant that is an Australian resident—the applicant is an Australian resident; or
(b) for an applicant that is not an Australian resident—the applicant has:
Part A—Information to be included in an application for a certificate for the location offset
Note: The Arts Minister must be satisfied that the applicant either carried out, or made the arrangements for the carrying out of, all the activities in Australia that were necessary for the making of the film (see paragraph 376‑20(5)(c) of the Act).
Note: If the film is a television series the running time (minutes) and commercial hours must be provided.
2.13 Details of any expenditure claimed as estimated qualifying Australian production expenditure by the applicant under item 4 of the table in subsection 376‑150(1) of the Act.
2.14 Whether the applicant incurred expenditure on the film as a foreign resident.
2.15 For any expenditure described in clause 2.14:
2.16 Whether or not the television series is predominantly a digital animation or other animation.
2.17 Length of time, in months, that it took for:
2.18 Number of episodes in the series.
2.19 Duration of the series, in hours.
2.20 Estimated qualifying Australian production expenditure for the series.
2.21 Estimated qualifying Australian production expenditure (in Australian dollars) divided by the running time of the series (in hours).
2.22 Details of any expenditure for the pilot episode (if any) that is estimated qualifying Australian production expenditure.
Part B—Documents to be attached to an application for a certificate for the location offset
(a) that it is made for rule 19; and
(ii) included in the qualifying Australian production expenditure claimed by the applicant for the location offset.