Document ID: chunk:federal_register_of_legislation:C2004A00662:clause:1_3:p11
Version: federal_register_of_legislation:C2004A00662
Segment Type: clause
Provision Reference: sch 1 cl 3 (pt 11/20)
Character Range: 28272–30953

apply at the same time, the entity must choose the car to which subsection (2) applies at that time. The choice remains in effect until the entity ceases to *hold that car.

Example: Continuing example 2 in section 86‑20: Assume that NewIT provides 3 cars to Ron. Car 1 is used solely for business purposes and cars 2 and 3 are used for private purposes.

 NewIT can deduct all the car expenses it incurs for car 1. It can also deduct all the car expenses it incurs for its choice of either car 2 or car 3, as well as the fringe benefits tax it pays for that car. However, it cannot deduct any car expenses or fringe benefits tax for the car that it does not choose.

Note: If car expenses for a car are not deductible because of section 86‑60, the car benefit being provided is an exempt benefit for the purposes of fringe benefits tax: see subsection 8(4) of the Fringe Benefits Tax Assessment Act 1986.

86‑75  Superannuation

 (1) Section 86‑60 does not stop a *personal services entity deducting a contribution the entity makes to a fund or an *RSA for the purpose of making provision for superannuation benefits payable for an individual whose *personal services income is included in the entity's *ordinary income or *statutory income.

For deductions for superannuation contributions: see Subdivision AA of Division 3 of Part III of the Income Tax Assessment Act 1936.

 (2) However, if:
 (a)  the individual performs less than 20% (by market value) of the entity's principal work; and
 (b) the individual is an *associate of another individual whose *personal services income is included in the entity's *ordinary income or *statutory income;
the entity's deduction cannot exceed the amount it would have to contribute, for the benefit of the individual, to a *complying superannuation fund or an *RSA in order to ensure that it did not have an *individual superannuation guarantee shortfall in respect of the individual.

 (3) To work out the amount the entity would have to contribute for the purposes of subsection (2), the individual's salary or wages, for the purposes of the Superannuation Guarantee (Administration) Act 1992, are taken to be the amount that section 86‑60 does not prevent the entity deducting for salary or wages it paid to the individual.

Note: Section 86‑60 will apply the limitations under sections 85‑10 and 85‑20 on an individual's entitlement to deductions (but see paragraph 85‑10(2)(e) on employment of associates).

86‑80  Salary or wages promptly paid

  Section 86‑60 does not stop a *personal services entity deducting an amount for salary or wages it pays to the individual referred to in that section before the end of the 14th day