Document ID: chunk:federal_register_of_legislation:C2010C00184:clause:1_1:p2
Version: federal_register_of_legislation:C2010C00184
Segment Type: clause
Provision Reference: sch 1 cl 1 (pt 2/8)
Character Range: 9961–12551

see subsection 121EG(3A) of the Income Tax Assessment Act 1936.

Taxes paid on section 23AI or 23AK amounts

 (2) An amount of *foreign income tax counts towards the *tax offset for you for the year if you paid it in respect of an amount that is your *non‑assessable non‑exempt income under either section 23AI or 23AK of the Income Tax Assessment Act 1936 for the year.

Note 1: Sections 23AI and 23AK of the Income Tax Assessment Act 1936 provide that amounts paid out of income previously attributed from a controlled foreign company or a foreign investment fund are non‑assessable non‑exempt income.

Note 2: Foreign income taxes covered by this subsection are direct taxes (for example, a withholding tax on a dividend payment) and not underlying taxes, only some of which are covered by section 770‑135.

Exception for certain residence‑based foreign income taxes

 (3) An amount of *foreign income tax you paid does not count towards the *tax offset for the year if you paid it:
 (a) to a foreign country because you are a resident of that country for the purposes of a law relating to the foreign income tax; and
 (b) in respect of an amount derived from a source outside that country.

Exception for previously complying funds and previously foreign funds

 (4) An amount of *foreign income tax paid by a *superannuation provider in relation to a *superannuation fund does not count towards the *tax offset for the year if:
 (a) the tax was paid in respect of an amount included in the fund's assessable income under table item 2 or 3 in section 295‑320; and
 (b) the provider paid the tax before the start of the income year.

Note: Table items 2 and 3 in section 295‑320 include additional amounts in the assessable income of superannuation funds that change their status from complying to non‑complying or from foreign to Australian.

Exception for credit absorption tax and unitary tax

 (5) An amount of *credit absorption tax or *unitary tax you paid does not count towards the *tax offset for the year.

770‑15  Meaning of foreign income tax, credit absorption tax and unitary tax

 (1) Foreign income tax means tax that:
 (a) is imposed by a law other than an *Australian law; and
 (b) is:
 (i) tax on income; or
 (ii) tax on profits or gains, whether of an income or capital nature; or
 (iii) any other tax, being a tax that is subject to an agreement having the force of law under the International Tax Agreements Act 1953.

 (2) Credit absorption tax means a tax imposed by a law of a foreign country, or of any part of, or place in, a foreign country to the extent