Commonwealth Consolidated Acts Commonwealth Consolidated Acts
Income Tax Assessment Act 1997
1 At the end of section 61 - 350
Add:
If you are entitled to a tax offset because you adopt a child, you might also be entitled to an offset if the child was in your care before the adoption.
2 Group heading before section 61 - 355
Repeal the heading, substitute:
Entitlement to a first child tax offset
3 Section 61 - 355 (heading)
Repeal the heading, substitute:
61 - 355 Who is entitled to a tax offset under this section
4 At the end of subsection 61 - 355(1)
Add:
Note: If you are entitled to a tax offset because you adopt a child, you might also be entitled to an offset if the child was in your care before the adoption (see section 61 - 440).
5 Section 61 - 365
After " * tax offset", insert "under section 61 - 355".
6 Section 61 - 370
After " * tax offset", insert "under section 61 - 355".
7 Paragraph 61 - 370(b)
Omit "the offset", substitute "a tax offset".
8 Subsection 61 - 375(2)
After " * tax offset", insert "under section 61 - 355".
9 Subsection 61 - 380(1)
After " * tax offset", insert "under section 61 - 355".
10 Group heading before section 61 - 385
Repeal the heading, substitute:
11 Section 61 - 385 (heading)
Repeal the heading, substitute:
61 - 385 You may transfer your entitlement to a tax offset
12 Subsection 61 - 385(1)
After "61 - 355", insert "or 61 - 440".
13 After subsection 61 - 385(1)
Insert:
(1A) However, if you are entitled to a * tax offset for a child for a particular income year under both of sections 61 - 355 and 61 - 440, you may only transfer one of those entitlements to another person if you also transfer the other entitlement to the same person.
14 Group heading before section 61 - 405
Repeal the heading, substitute:
Claiming a first child tax offset
15 Group heading before section 61 - 415
Repeal the heading, substitute:
Amount of a first child tax offset
16 Section 61 - 415
After " * tax offset", insert "under sections 61 - 355 and 61 - 440".
17 Subsections 61 - 425(1) and (2)
After " * tax offset", insert "under either or both of sections 61 - 355 and 61 - 440".
18 At the end of subsection 61 - 430(1)
Add:
Note: If a child is in your care before you adopt the child, your base year can instead be the year the child was first in your care or the year before that (see section 61 - 450).
19 Subsection 61 - 430(3)
Repeal the subsection, substitute:
(3) A choice cannot be made:
(a) after you have claimed the * tax offset under section 61 - 355 for any income year; or
(b) after you have transferred your entitlement to the tax offset under section 61 - 355 for any income year.
20 Section 61 - 430 (link note)
Repeal the link note, substitute:
Additional tax offset if a child is in your care before you legally adopt the child
61 - 440 Additional tax offset if a child is in your care before you legally adopt the child
(1) You are entitled to a * tax offset for a child for an income year if:
(a) you meet the conditions in paragraph (3)(a) at any time in the income year; and
(b) you meet the conditions in paragraphs (3)(b), (c) and (d).
Note: You are not entitled to a tax offset under this section if section 61 - 455 applies to you.
(2) To meet those conditions for a child at a given time is to have a primary entitlement to the * tax offset for the child at that time.
(3) The conditions are that:
(a) at the time:
(i) the child is less than 5; and
(ii) the child is in your care (but you are not legally responsible for the child); and
(iii) you are an Australian resident; and
(b) you meet the conditions in subsection 61 - 355(3) in relation to the child in that year or a later income year; and
(c) you have become legally responsible for the child by adopting the child; and
(d) the time is on or after 1 July 2001 and before 1 July 2004.
Note: See section 61 - 445 for when a child is first in your care.
61 - 445 When a child is first in your care
For the purposes of sections 61 - 440 and 61 - 450, a child is first in your care on the date evidenced in writing by a court or relevant department of the relevant State or Territory.
61 - 450 What is your base year if a child is in your care before you legally adopt the child?
Your base year can relate to a year during which a child was in your care before you adopted the child
(1) This section defines your base year if you are entitled to a * tax offset for a child under section 61 - 440 (which is where a child is in your care before you legally adopt the child).
Primary entitlement
(2) Your base year for a * tax offset under sections 61 - 355 and 61 - 440 is:
(a) if you were an Australian resident at any time in the income year (the previous income year ) just before the income year in which the child was first in your care--the later of the following years:
(i) the previous income year;
(ii) the income year commencing on 1 July 2000; and
(b) otherwise--the later of the following years:
(i) the earliest income year in which you were an Australian resident and the child was in your care;
(ii) the income year commencing on 1 July 2001.
Note: See section 61 - 445 for when a child is first in your care.
(3) If paragraph (2)(a) applies to you, you may choose, in the * approved form, the later of the following years to be your base year:
(a) the year the child was first in your care;
(b) the income year commencing on 1 July 2001.
A choice cannot be revoked.
(4) A choice cannot be made:
(a) after you have claimed the * tax offset under section 61 - 440 for any income year; or
(b) after you have transferred your entitlement to the tax offset under section 61 - 440 for any income year.
Transferred entitlement
(5) Your base year for an entitlement transferred to you under section 61 - 385 is the income year before the first income year for which the entitlement for the child was transferred to you.
61 - 455 Old Subdivision applies if you would be worse off
This Subdivision as in force on 30 June 2004 (instead of this Subdivision as amended by Schedule 10 to the Tax Laws Amendment (2004 Measures No. 6) Act 2005 ) continues to apply to you if the amount of all * tax offsets to which you would be entitled under this Subdivision as in force on that date is more than the amount of all tax offsets to which you would be entitled under the amended Subdivision.
Note: The effect of this is that:
(a) you are only entitled to a tax offset in respect of days for which you are legally responsible for the child (and not days during which the child is in your care); and
(b) your base year is the income year in which the child event happened or the year before.
21 Subsection 995 - 1(1) (both definitions of base year )
Repeal the definitions, substitute:
"base year" :
(a) for an entitlement to a * tax offset under Subdivision 61 - I--has the meaning given by sections 61 - 430 and 61 - 450; and
(b) otherwise--has the meaning given by sections 45 - 320 and 45 - 470 in Schedule 1 to the Taxation Administration Act 1953 .
22 Subsection 995 - 1(1) (definition of primary entitlement )
Omit "subsection 61 - 355(2)", substitute "subsections 61 - 355(2) and 61 - 440(2)".
23 Application of amendments
The amendments made by this Schedule apply to assessments for income years that commence on or after 1 July 2001.