Document ID: chunk:federal_register_of_legislation:C2010C00615:clause:3_160apbb
Version: federal_register_of_legislation:C2010C00615
Segment Type: clause
Provision Reference: sch 3 cl 160APBB
Character Range: 220762–222607

160APBB  Paying PAYG instalment or company tax

 (1) For the purposes of this Part, a person pays a PAYG instalment or company tax if and only if:
 (a) the person has a liability to pay the instalment or the company tax; and
 (b) either:
 (i) the person makes a payment to satisfy the liability (in whole or in part); or
 (ii) a credit, or an RBA surplus, is applied to discharge or reduce the liability.

Note: The requirement in paragraph (a) means that the company cannot generate franking credits by making a "voluntary" payment of company tax (that is, paying an amount on account of company tax for which the company is not liable at the time when the payment is made).

 (2) Subparagraph (1)(b)(ii) does not apply to the application of a credit allowable under or by virtue of:
 (a) Division 18, 18A or 18B of Part III; or
 (b) the International Tax Agreements Act 1953; or
 (c) section 45‑30 or 45‑215 in Schedule 1 to the Taxation Administration Act 1953.

 (3) The amount of the PAYG instalment or company tax paid is equal to:
 (a) the amount of the liability if it is satisfied in full; or
 (b) the amount by which the liability is reduced if it is not satisfied in full.

 (4) If:
 (a) a surplus in an RBA of a company is applied to satisfy a liability of the company to pay a PAYG instalment in respect of a year of income; and
 (b) a credit allowable under section 45‑30 in Schedule 1 to the Taxation Administration Act 1953 in respect of that year of income is included in the RBA; and
 (c) the RBA does not include the liability to pay the PAYG instalment; and
 (d) the amount of the credit exceeds the company tax assessed to the company in respect of that year of income;
the amount of the PAYG instalment paid by virtue of the application of the surplus is reduced by the amount of the excess referred to in paragraph (d).