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INCOME TAX ASSESSMENT ACT 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-35 - INSURANCE BUSINESS    View history reference

Division 320 - Life insurance companies    View history reference

Subdivision 320-B - What is included in a life insurance company's assessable income    View history reference

Operative provisions

SECTION 320-37  Non-assessable non-exempt income  

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320-37(1)  

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These amounts *derived by a *life insurance company are not assessable income and are not *exempt income:


(a) amounts of ordinary income and statutory income derived from *segregated exempt assets, being income that relates to the period during which the assets were segregated exempt assets;


(b) amounts of ordinary income and statutory income derived from the *disposal of units in a *pooled superannuation trust;


(c) if an *Australian/overseas fund or an *overseas fund established by the company derived foreign establishment amounts - the foreign resident proportion of the foreign establishment amounts;
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(d) if the company is a *friendly society:

(i) amounts derived before 1 July 2001 that are exempt from income tax under section 50-1; and

(ii) amounts derived on or after 1 July 2001 but before 1 January 2003, that are attributable to *income bonds, *funeral policies or *sickness policies; and

(iii) amounts derived on or after 1 July 2001 but before 1 January 2003, that are attributable to *scholarship plans and would have been exempt from income tax under section 50-1 if they had been received before 1 July 2001; and

(iv) amounts derived on or after 1 January 2003 that are attributable to income bonds, funeral policies or *sickness policies, that were issued before 1 January 2003; and

(v) amounts derived on or after 1 January 2003 that are attributable to scholarship plans issued before 1 January 2003 and that would have been exempt from income tax if they had been received before 1 July 2001.
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Note:

The effect of this section is modified when the life insurance business of a life insurance company is transferred to another life insurance company: see section 320-325.

320-37(1A)  

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For the purposes of paragraph (1)(c), foreign establishment amounts for the *life insurance company means the total amount of assessable income that was *derived in the income year:


(a) in the course of the carrying on by the company of a business in a foreign country at or through a *permanent establishment of the company in that country; and


(b) from sources in that or any other foreign country; and


(c) from assets that:


(i) are attributable to the permanent establishment; and

(ii) are held to meet the liabilities under the *life insurance policies issued by the company at or through the permanent establishment.

320-37(2)  

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For the purposes of paragraph (1)(c), the foreign resident proportion of the *foreign establishment amounts is the amount worked out using the formula:
 Foreign
establishment
amounts
×Foreign resident foreign
establishment policy liabilities
All foreign establishment
policy liabilities
 

where:

all foreign establishment policy liabilities means the average value for the income year (as calculated by an *actuary) of the policy liabilities (as defined in the *Valuation Standard) for all *life insurance policies that:


(a) were included in the class of *life insurance business to which the company's *Australian/overseas fund or *overseas fund relates; and


(b) were issued by the company at or through the *permanent establishment to which the foreign establishment amounts relate.

foreign resident foreign establishment policy liabilities means the average value for the income year (as calculated by an *actuary) of the policy liabilities (as defined in the *Valuation Standard) for all *life insurance policies that:


(a) are *foreign resident life insurance policies; and


(b) were issued by the company at or through the *permanent establishment to which the foreign establishment amounts relate.

Archived:

S 320-40 repealed as inoperative by No 101 of 2006, s 3 and Sch 1 item 240, effective 14 September 2006. For application and savings provisions and for former wording see the CCH Australian Income Tax Legislation archive.


 



This information is provided by CCH Australia Limited. View the disclaimer and notice of copyright.
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