Document ID: chunk:federal_register_of_legislation:C2010C00184:clause:1_1:p1
Version: federal_register_of_legislation:C2010C00184
Segment Type: clause
Provision Reference: sch 1 cl 1 (pt 1/8)
Character Range: 7493–10178

1  After Division 768
Insert:

Division 770—Foreign income tax offsets

Table of Subdivisions

 Guide to Division 770
770‑A Entitlement rules for foreign income tax offsets
770‑B Amount of foreign income tax offset
770‑C Rules about payment of foreign income tax
770‑D Administration

Guide to Division 770

770‑1  What this Division is about

      You may get a non‑refundable tax offset for foreign income tax paid on your assessable income.
      There is a limit on the amount of the tax 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.

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)).

Note 3: For offshore banking units, the amount of foreign income tax paid in respect of offshore banking income is reduced: 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