Taxation Administration Act 1953

A *custodian must pay an amount to the Commissioner if:

the trustee of a trust that was an *AMIT for an income year and was a *withholding MIT in relation to the income year made a payment (the first deemed payment) that:

arose because of the operation of section 12A‑205; and

was a *fund payment or an *AMIT DIR payment; and

the custodian makes a payment (the subsequent deemed payment) that arises because of the operation of section 12A‑205; and

the first deemed payment gave rise to the subsequent deemed payment, because of one or more operations of section 12A‑205; and

the subsequent deemed payment or part of it (the covered part) was covered by a notice or information under:

if the first deemed payment was a fund payment—section 12‑395; or

if the first deemed payment was an AMIT DIR payment—section 12A‑15; and

the subsequent deemed payment is made to an entity (the recipient) that is:

if the first deemed payment was a fund payment—covered by section 12‑410; or

if the first deemed payment was an AMIT DIR payment—not an Australian resident.

An entity may be covered by section 12‑410 if the entity has an address outside Australia or payment is authorised to be made to a place outside Australia.

If the payment is made to a recipient not covered by subparagraph (e)(i) or (ii), the trustee is required to give a notice to the recipient or publish information on a website setting out certain details about the payment: see sections 12‑395 and 12A‑15.

The amount that the *custodian must pay is the amount that the custodian would, if the assumptions in subsection (3) were made, have had to withhold under:

if the first deemed payment was a *fund payment—subsection 12‑390(1); or

if the first deemed payment was an *AMIT DIR payment—section 12‑210, 12‑245 or 12‑280.

The assumptions are that:

the subsequent deemed payment had not arisen because of the operation of section 12A‑205; and

the subsequent deemed payment had instead been an actual payment; and

if the first deemed payment was an *AMIT DIR payment:

where the first deemed payment corresponded to the character of a dividend (as defined in Division 11A of Part III of the Income Tax Assessment Act 1936) that is subject to a requirement to withhold under Subdivision 12‑F—the *custodian had been a company, and it had paid the subsequent deemed payment as a dividend; or

where the first deemed payment corresponded to the character of interest (as defined in Division 11A of Part III of the Income Tax Assessment Act 1936) that is subject to a requirement to withhold under Subdivision 12‑F—the subsequent deemed payment were the payment of interest; or

where the first deemed payment corresponded to the character of a *royalty that is subject to a requirement to withhold under Subdivision 12‑F—the subsequent deemed payment were the payment of a royalty; and

if the first deemed payment was an AMIT DIR payment—the condition in either or both of paragraphs 12‑210(a) or (b), of paragraphs 12‑245(a) or (b) or of paragraphs 12‑280(a) or (b) (as the case requires) were satisfied.

The *custodian may recover from the recipient as a debt an amount that the custodian has paid to the Commissioner under subsection (1).

The *custodian is entitled to set off an amount that the custodian can recover from the recipient under subsection (4) against debts due by the custodian to the recipient.