Document ID: chunk:federal_register_of_legislation:C2025C00029:section:3:p10
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 3 (pt 10/20)
Character Range: 6816090–6818722

offset.
      A resident of a foreign country does not get the offset for some foreign income taxes.
      You may also get the offset for foreign income tax paid on some amounts that are not taxed in Australia.

770‑5  Object
 (1) The object of this Division is to relieve double taxation where:
 (a) you have paid foreign income tax on amounts included in your assessable income; and
 (b) you would, apart from this Division, pay Australian income tax on the same amounts.
 (2) To achieve this object, this Division gives you a tax offset to reduce or eliminate Australian income tax otherwise payable on those amounts.
Note 1: This Division applies in relation to Medicare levy and Medicare levy (fringe benefits) surcharge in the same way as it applies to Australian income tax. See section 90‑1 in Schedule 1 to the Taxation Administration Act 1953.
Note 2: The tax offset under this Division can be applied against your Medicare levy and Medicare levy (fringe benefits) surcharge liability for the year, if an amount of it remains after you apply it against your basic income tax liability. See item 22 of the table in subsection 63‑10(1).

Subdivision 770‑A—Entitlement rules for foreign income tax offsets

Table of sections

Basic entitlement rule for foreign income tax offset
770‑10 Entitlement to foreign income tax offset
770‑15 Meaning of foreign income tax, credit absorption tax and unitary tax

Basic entitlement rule for foreign income tax offset

770‑10  Entitlement to foreign income tax offset
 (1) You are entitled to a *tax offset for an income year for *foreign income tax. An amount of foreign income tax counts towards the tax offset for the year if you paid it in respect of an amount that is all or part of an amount included in your assessable income for the year.
Note 1: The offset is for the income year in which your assessable income included an amount in respect of which you paid foreign income tax—even if you paid the foreign income tax in another income year.
Note 2: If the foreign income tax has been paid on an amount that is part non‑assessable non‑exempt income and part assessable income for you for the income year, only a proportionate share of the foreign income tax (the share that corresponds to the part that is assessable income) will count towards the tax offset (excluding the operation of subsection (2)).

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