Document ID: chunk:federal_register_of_legislation:C2004C00958:clause:1_9:p5
Version: federal_register_of_legislation:C2004C00958
Segment Type: clause
Provision Reference: sch 1 cl 9 (pt 5/11)
Character Range: 670840–673385

pay at *basic rates.

Extra income tax

 (3) You must pay extra income tax on the *averaging component of your *basic taxable income if the income tax you would pay at the comparison rate is more than the amount of income tax you would pay at *basic rates.

Note 1: Section 12A of the Income Tax Rates Act 1986 sets the rate at which you must pay extra income tax on the averaging component of your basic taxable income.

Note 2: It does so in such a way that, generally, the extra income tax you must pay equals the averaging adjustment worked out under Subdivision 392‑C.

Note 3: If family tax assistance raises your tax‑free threshold above your taxable income, subsections 12A(3) and (4) of that Act set a lower rate, so that the extra income tax you must pay is reduced by the amount of income tax that family tax assistance would have saved you had your taxable income been increased to equal your tax‑free threshold.

Meaning of basic rates

 (4) The basic rates at which you would pay income tax are:

 (a) if you are a resident taxpayer as defined in the Income Tax Rates Act 1986—the rates of income tax in paragraph 1(b) of Part I of Schedule 7 to that Act:

 (i) taking into account the way it would apply with any changes to your tax‑free threshold under section 20 of that Act; and

 (ii) disregarding the effect of Division 5 of Part II of that Act (which provides family tax assistance); or

 (b) if you are a non‑resident taxpayer as defined in the Income Tax Rates Act 1986—the rates of income tax in paragraph 1(b) of Part II of Schedule 7 to that Act.

Disregard certain provisions in working out amounts

 (5) Work out the amount of income tax mentioned in paragraph (1)(b) as if:

 (a) the following provisions did not apply:

 (i) this Division;

 (ii) section 94 (Partner not having control and disposal of share in partnership income) of the Income Tax Assessment Act 1936;

 (iii) Division 6AA (Income of certain children) of Part III of the Income Tax Assessment Act 1936;

 (iv) Part VIIB (Medicare levy) of the Income Tax Assessment Act 1936; and

 (b) you were not entitled to any rebate or credit under the Income Tax Assessment Act 1936 or to any *tax offset under this Act.

No adjustment

 (6) This Division does not affect your income tax for the *current year if the income tax you would pay at the *comparison rate equals the amount of income tax you would pay at *basic rates.

Note: The 2 amounts will be equal if:

                  * your basic taxable income and your average