Document ID: chunk:federal_register_of_legislation:C2025C00029:section:3:p14
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 3 (pt 14/34)
Character Range: 1695031–1697950

The total amount of the deductions to which a *personal services entity is entitled for an income year is reduced by the amount of any deduction that an individual, whose *personal services income is ordinary or statutory income of the entity for that income year, is entitled to under section 86‑27.

86‑90  Application of Divisions 28 and 900 to personal services entities
  This Division does not have the effect of applying Division 28 (about car expenses) or Division 900 (about substantiation rules) to a *personal services entity.
Note: Divisions 28 and 900 can still apply to a personal services entity that is a partnership: see subsections 28‑10(2) and 900‑5(2).

Division 87—Personal services businesses

Table of Subdivisions

Guide to Division 87
87‑A General
87‑B Personal services business determinations

Guide to Division 87

87‑1  What this Division is about

      Divisions 85 and 86 do not apply to personal services income that is income from conducting a personal services business.
      It is not intended that the Divisions apply to independent contractors.
      A personal services business exists if there is a personal services business determination or if one or more of 4 tests for what is a personal services business are met.
      Regardless of how much of your personal services income is paid from one source, you can self‑assess against the results test to determine whether you are an independent contractor. The results test is based on the traditional tests for determining independent contractors and it is intended that it apply accordingly.
      However, you cannot "self‑assess" whether you meet any of the other 3 tests if 80% or more of your personal services income is from one source. In these cases, you need a personal services business determination in order to be treated as conducting a personal services business.

87‑5  Diagram showing the operation of this Division
  This diagram shows how this Division operates to ascertain whether personal services income is income from conducting a personal services business.

Subdivision 87‑A—General

Table of sections
87‑10 Object of this Division
87‑15 What is a personal services business?
87‑18 The results test for a personal services business
87‑20 The unrelated clients test for a personal services business
87‑25 The employment test for a personal services business
87‑30 The business premises test for a personal services business
87‑35 Personal services income from Australian government agencies
87‑40 Application of this Division to certain agents

87‑10  Object of this Division
  The object of this Division is to define *personal services businesses in a way that ensures that it covers genuine businesses but not situations that are merely arrangements for dealing with the *personal services income of individuals.

87‑15  What is a personal services business?
 (1) An individual or *personal services