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This is a Bill, not an Act. For current law, see the Acts databases.
1998
The Parliament of
the
Commonwealth of
Australia
HOUSE OF
REPRESENTATIVES
Presented and read a first
time
Taxation Laws
Amendment (Private Health Insurance) Bill
1998
No. ,
1998
(Treasury)
A Bill
for an Act to amend the law relating to income tax in respect of private health
insurance, and for related purposes
ISBN: 0642 378185
Contents
A Bill for an Act to amend the law relating to income tax
in respect of private health insurance, and for related
purposes
The Parliament of Australia enacts:
This Act may be cited as the Taxation Laws Amendment (Private Health
Insurance) Act 1998.
This Act commences on the day on which it receives the Royal
Assent.
Each Act that is specified in a Schedule to this Act is amended or
repealed as set out in the applicable items in the Schedule concerned, and any
other item in a Schedule to this Act has effect according to its
terms.
1 At the end of paragraph
16(4)(fb)
Add “or the Private Health Insurance Incentives Act
1998”.
2 Subsection 159J(6) (after paragraph (aab) of
the definition of separate net income)
Insert:
(aac) does not include any amount paid under the Private Health
Insurance Incentives Act 1998; and
3 After paragraph
170(10AA)(m)
Insert:
(n) Subdivision 61-H;
4 Subsection 221YCAA(2A)
After “61-305”, insert “or 61-335”.
5 Before section 264C
Insert:
(1) The Commissioner may, by notice in writing, require a health fund to
provide information relevant to the operation of this Act about each person who
is covered at any time during a financial year specified in the notice by an
appropriate private health insurance policy issued by the fund or who paid
premiums under such a policy.
(2) The information that the Commissioner may require the health fund to
provide includes the following:
(a) the name, address and date of birth of each such person;
(b) the fund membership number of the policy;
(c) the name, address and date of birth of the person covered by the
policy whom the health fund treats as the contributor in respect of the
policy;
(d) the name, address and date of birth of any person who is a partner of
a person covered by the policy;
(e) whether the policy provides hospital cover, ancillary cover or
combined cover;
(f) the date on which the policy was issued;
(g) whether the policy has terminated or been suspended, and, if it has,
the date on which it terminated or was suspended;
(h) the amount of the premium under the policy;
(i) the period to which the premium relates;
(j) any increase or decrease in the premium;
(k) whether a payment in respect of a premium that was due within a period
specified by the Commissioner was not paid.
(3) The information required by a notice under subsection (1) is to be
provided:
(a) in a form (including an electronic form) approved by the Commissioner;
and
(b) within the period specified in the notice.
(4) In this section, the following terms have the same meanings as in the
Private Health Insurance Incentives Act 1998:
|
ancillary cover |
|
appropriate private health insurance policy |
|
combined cover |
|
health fund |
|
hospital cover |
|
partner |
6 Application
The amendments of the Income Tax Assessment Act 1936 made by this
Schedule apply to assessments in respect of income for the 1998-99 year of
income and all later years of income.
1 Subsection 4-10(3) (step 4 of the method
statement)
Omit “(If your total tax offsets exceed your basic income tax
liability, you are not entitled to a refund, or to offset the excess against any
other liability.)”.
2 Subsection 4-10(3) (note)
Repeal the note.
3 After subsection 4-10(3)
Insert:
(3A) If you have a *tax offset that is a
private health insurance tax offset and it exceeds your basic income tax
liability, you can, after allowing certain other tax offsets, get a refund of
the excess under section 67-25. If the total of your other tax offsets exceeds
your basic income tax liability, you are not entitled to a refund or to offset
the excess of your other tax offsets against any other liability.
Note: Some tax offsets can be carried forward to a later
year. See, for example, section 160AFE of the Income Tax Assessment Act
1936, which deals with the carry forward of excess foreign tax
credits.
4 Section 11-15
After:
|
persecution victim, pension etc. for |
23(kca) |
insert:
|
private health insurance |
52-125 |
5 Section 13-1 (table item headed “private
health insurance”)
Omit “Subdivision 61-G”, substitute
“Subdivisions 61-G and
61-H”.
6 Section 52-1 (at the end of the Table of
Subdivisions)
Add:
52-D Exempt payments made by the Commonwealth to reimburse
certain expenditure
7 Subdivision 52-D
(heading)
Repeal the heading, substitute:
8 At the end of Subdivision
52-D
Add:
A payment made to you under Chapter 2 of the Private Health Insurance
Incentives Act 1998 is exempt from income tax.
9 Subdivision 61-G
(heading)
Repeal the heading, substitute:
10 At the end of Subdivision
61-G
Omit:
[The next Division is Division 65.]
11 After Subdivision 61-G
Insert:
You can choose to claim a tax offset for a premium, or an amount in respect
of a premium, paid under a private health insurance policy instead of receiving
a payment under Chapter 2 of the Private Health Insurance Incentives Act
1998.
Table of sections
Operative provisions
61-335 Entitlement to the private health insurance tax
offset
61-340 Amount of the private health insurance tax
offset
61-345 How to work out the incentive amount
(1) If you are an individual (other than an individual in the capacity of
an employer), you are entitled to a *tax offset
for the 1998-99 income year or a later income year if the conditions in
subsections (2) and (3) are satisfied.
(2) A premium, or an amount in respect of a premium, was paid by you, or
by your employer as a *fringe benefit for you,
whether before or after the commencement of this Subdivision, under an
appropriate private health insurance policy (within the meaning of the
Private Health Insurance Incentives Act 1998) for the 1998-99 income year
or a later income year.
(3) The premium, or amount in respect of a premium, was paid during the
income year or, for the 1998-99 income year, before or during that
year.
(4) You are also entitled to the *tax
offset if:
(a) you are a trustee who is liable to be assessed under section 98 of the
Income Tax Assessment Act 1936 in respect of a share of the net income of
a trust estate; and
(b) the beneficiary who is presently entitled to the share of the income
of the trust estate would be entitled to the tax offset because of subsection
(1).
(5) However, you are not entitled to the
*tax offset in respect of the payment of any
premium, or any amount in respect of a premium, if:
(a) you have received an amount under Chapter 2 of the Private Health
Insurance Incentives Act 1998 in relation to the payment; or
(b) the premium, or the amount in respect of a premium, was less than it
would otherwise have been because of the operation of Chapter 3 of that
Act.
(6) The *tax offset is subject to the
refundable tax offset rules in Division 67.
Note: This means that, in certain circumstances, you can get
a refund of the tax offset.
(1) The amount of the *tax offset for a
premium, or an amount in respect of a premium, paid under a policy for the
1998-99 income year depends upon whether or not a person was registered, or
eligible to apply for registration, before 1 January 1999 under the Private
Health Insurance Incentives Act 1997 in respect of the policy for the income
year.
(2) If no person was so registered or eligible to apply for registration,
the amount of the *tax offset is 30% of the
premium, or of the amount in respect of a premium, paid by you, or by your
employer as a *fringe benefit for you, under
the policy for the income year.
(3) If a person was so registered or eligible to apply for registration,
the amount of the *tax offset is the greater of
the amount worked out under paragraph (a) and the amount worked out under
paragraph (b):
(a) 30% of:
(i) the amount of the premium, or the amount in respect of a premium, paid
by you, or by your employer as a *fringe
benefit for you, under the policy for the income year; or
(ii) if, because of the operation of the Private Health Insurance
Incentives Act 1997, that amount was less than the amount that would
otherwise have been payable—the amount that would otherwise have been
payable; and
(b) the incentive amount for the policy for the income year.
(4) The amount of the *tax offset for a
premium, or an amount in respect of a premium, paid under a policy for a later
income year depends upon whether or not a person was registered, or eligible to
apply for registration, before 1 January 1999 under the Private Health
Insurance Incentives Act 1997 in respect of the policy for the 1998-99
income year.
(5) If no person was so registered or eligible to apply for registration,
the amount of the *tax offset is 30% of the
amount of the premium, or of the amount in respect of a premium, paid by you, or
by your employer as a *fringe benefit for you,
under the policy for the later income year.
(6) If a person was so registered or eligible to apply for registration,
the amount of the *tax offset is the greater
of:
(a) 30% of the amount of the premium, or of the amount in respect of a
premium, paid by you, or by your employer as a
*fringe benefit for you, under the policy for
the later income year; and
(b) the incentive amount for the policy for the later income
year.
(7) In working out an amount of a *tax
offset for an amount paid by you, or by your employer as a
*fringe benefit for you, under a policy,
disregard any part of the amount paid that relates to a period before 1 January
1999.
(8) If, because of the operation of the Private Health Insurance
Incentives Act 1997, an amount paid by you, or by your employer as a
*fringe benefit for you, under a policy for a
period after 31 December 1998 was less than the amount that would otherwise have
been payable, the *tax offset in respect of the
amount paid is reduced by the amount of the difference.
(1) The incentive amount for an appropriate private health
insurance policy for an income year is worked out in accordance with the
following table:
|
Incentive amounts |
||||
|---|---|---|---|---|
|
Item |
Number and kinds of people covered by the
policy |
Policy provides
*hospital cover but not
*ancillary cover |
Policy provides
*ancillary cover but not
*hospital cover |
Policy provides
*combined cover |
|
1 |
3 or more people |
$350 |
$100 |
$450 |
|
2 |
One dependent child and one other person |
$350 |
$100 |
$450 |
|
3 |
2 people neither of whom is a dependent child |
$200 |
$50 |
$250 |
|
4 |
One person |
$100 |
$25 |
$125 |
(2) If the amount of the premium, or the amount in respect of a premium,
paid by you, or by your employer as a *fringe
benefit for you, under the appropriate private health insurance policy is for
part only of the income year, the incentive amount is worked out
using the following formula:
[The next Division is Division 65.]
12 Subsection 65-25(2) (before table item
1)
Insert:
|
1A |
Private health insurance tax offset |
Subdivision 61-H |
13 At the end of Division
65
Omit:
[The next Part is Part 2-25.],
substitute:
[The next Division is Division 67.].
14 After Division 65
Insert:
This Division sets out the rules about refunds of tax offsets
Table of sections
Operative provisions
67-20 Which tax offsets this Division applies
to
67-25 When you can get a refund of a tax
offset
[This is the end of the guide.]
This Division only applies to a *tax
offset if it is stated to be subject to the refundable tax offset
rules.
Note: The only tax offset that is subject to these rules is
the private health insurance tax offset under Subdivision 61-H.
(1) You can get a refund of a *tax offset
if the amount of the tax offset exceeds the amount of income tax that you would
have to pay if:
(a) you had not got the tax offset; and
(b) you had not got any tax offsets that are of a higher
priority.
(2) The following table sets out the order of priority for
*tax offsets (with the highest priority shown
first):
|
Item |
Tax offset |
Relevant person |
|---|---|---|
|
1 |
private health insurance tax offset |
Subdivision 61-H |
|
2 |
all other tax offsets |
listed in section 13-1 or referred to in section 160AFE of the Income
Tax Assessment Act 1936 |
The amount of the refund of a *tax
offset is the amount of the excess referred to in subsection 67-25(1).
[The next Part is Part 2-25.]
15 Subsection 995-1(1)
Insert:
incentive amount has the meaning given by section
61-345.
16 Application
The amendments of the Income Tax Assessment Act 1997 made by this
Schedule apply to assessments in respect of income for the 1998-99 income year
and all later income years.