Section B: Income
Item 10 - Income
For ATO instructions refer to Income item 10 on the ATO website.
For information on tax rates on the ATO website refer to Appendix 3: Rates of Tax.
Tax Rates
For AE and Series 6 & 8 only
A concessional rate of tax applies to the low tax component and the non-arm's length component is taxed at the highest marginal tax rate. For rates in MYOB Tax refer to Maintenance > Tax Rates > Funds.
Fund return Income tab labels
If the fund had a CGT event happen during the income year, or if the fund received a distribution of a capital gain from a trust, answer Yes at label G.
In addition to calculating your capital gain or loss, you may also need to include income at X Forestry managed investment scheme income.
For ATO instructions on completing Label G refer to Did you have a capital gains tax (CGT) event during the income year? on the ATO website.
MYOB Tax Capital gains worksheet 'g'
Use the Capital gains worksheet 'g' to record all CGT events. The worksheet:
Allows you to build up an index of assets transactions.
Will calculate all capital gains and losses.
Will apply current year losses.
Will apply prior year losses. If you need to record a Prior Year loss for any Asset category, create the Asset and set the item number to zero. Enter the amount of the Capital Loss, and click the Prior Year Losses button to dissect the loss into the years in which the loss was incurred.
Will integrate all relevant values to the labels in the main return.
Will prepare the ATO Capital Gains Schedule (BW) for lodgment where the Populate BW checkbox is selected in the worksheet ‘g’.
Quick access to Tax Office CGT: If you are not using the Capital gains worksheet 'g' answer YES at the prompt to open the ATO Capital Gains schedule to complete the BW manually.
At label M select Y from the list if an exemption or rollover has been applied to any CGT event.
Select the code for the exemption or rollover from the list at label M. Alternatively, To open the Capital Gains Worksheet (g) click Label M and the code will integrate from the value entered worksheet g.
From 1 July 2012, where you have applied an exemption or rollover to a capital gain calculated, you must advise the ATO of the type of exemption or rollover that has been applied.
The code may be selected directly at this label or if you use the Capital Gains worksheet to record the details of this transaction the relevant code will integrate to the return at this label.
Whether you enter the code directly at the label in the return or into the worksheet g, you will be prevented from selecting a code that is incompatible with the form type.
Refer to Capital gains worksheet (g) for information on data for Rollover/Retirement or General Exemption.
This is the total capital gains made for the income year less capital losses for that year, prior year net capital losses and any other relevant concession. In addition to calculating your capital gain or loss you may also need to include income at label X Forestry managed investment scheme income.
For calculation of estimate only box: If the net capital gain at label A includes an amount of Foreign Capital Gain, and if foreign tax was paid on that foreign gain, enter the amount of the Foreign tax at the special label Net foreign gains included at label A and then enter any foreign tax paid on that gain in the foreign income worksheet (for) in order that any foreign income tax offset calculated includes this in the calculation of the cap.
Quick access to Capital Gains Schedule? If you are not using the Capital gains worksheet 'g' answer YES at this prompt to open the ATO Capital Gains schedule for manual completion. Capital Gains amounts integrate from either the Capital Gains tax worksheet (g) or the Capital Gains Schedule (BW).
In the Capital gains worksheet (g) (refer to Capital gains worksheet (g)) to record a Prior Year loss for any Asset category:
Enter the Category of the asset.
Set the Item number to zero.
Enter the amount of the Capital Loss.
Click the Prior Year Losses button to dissect the loss into the years in which the loss was incurred.
CCH References
11-000 Overview of the capital gains tax provisions
11-240 Overview of the CGT events
22-072 Capital gains withholding regime for foreign residents
13-050 Superannuation funds
13-100 Complying and regulated fund status
13-120 Taxation of complying superannuation entities
13-125 Assessable Income and Contributions
13-130 Capital gains
For ATO instructions on completing Label B refer to Gross rent and other leasing and hiring income on the ATO website.
You can use the generic dissection worksheet at label B which integrates the sum of the entries made to label B.
Alternatively, the Rental schedule may be used to calculate Rental income but this does not integrate to the return.
CCH References
10-000 What is Assessable Income?
10-005 Checklist of Taxable and Non-Taxable Items
10-500 Rents and premiums
For ATO instructions on completing Label C refer to Gross interest on the ATO website.
Do not include any interest income distributed from a trust. Include this income at label Q Trust distributions other amounts.
Any TFN tax deducted from interest should be included in Section D: label H3 of the Income tax calculation statement.
Record the interest income transactions on the Interest income worksheet (int). The gross amount integrates to label C in the main return. Refer to Interest Income worksheet (int) – individuals.
For information on non-share dividends and non-share equity interests, refer to the ATO website for Debt and equity tests: guide to the debt and equity tests.
CCH References
10-005 Checklist of Taxable and Non-Taxable Items
10-470 Interest
13-140 Investments in life policies and PSTs
Show at label X the total income from all the activities in forestry interests that the fund holds in forestry managed investment schemes (FMISs). The amount you show at label X will depend on the points below.
Do not include capital gains from an FMIS; show these at label A Net capital gain. For more in-formation on the CGT treatment of the fund’s forestry interests, see the Guide to capital gains tax 2017-18.
If the fund is a member of a collapsed agribusiness managed investment scheme, see Ongoing operation of an agribusiness managed investment scheme on the ATO website for instructions.
Record details of Forestry managed investment scheme income on the FMIS worksheet (fms) and these will integrate to the return. Refer to Forestry managed investment scheme worksheet (fms).
For ATO instructions and examples when completing label X refer to Forestry managed investment income on the ATO website.
Refer to Forestry managed investment schemes and for the CGT treatment of Forestry interests refer to the ATO guide to capital gains tax (NAT 4151) that can be found on the ATO Capital gains tax home page.
CCH References
18-020 Registered agricultural managed investment schemes
Net foreign income amounts integrate from the Foreign income worksheet (for) worksheet and any Foreign Tax Credit integrates to label C1 in Section D.
For ATO instructions when completing label D refer to Net foreign income on the ATO website.
Gross foreign income amounts integrate from the Foreign income worksheet (for) worksheet and any Foreign Tax Credit integrates to label C1 in Section D.
For ATO instructions when completing label D1 refer to Gross foreign income on the ATO website.
Refer to the rules contained in the Guide to the taxation of financial arrangements (TOFA) rules on the ATO website.
The fund may also need to complete a Losses schedule.
CCH References
4-490 Trans-Tasman triangular imputation rules
10-000 What is Assessable Income?
10-005 Checklist of Taxable and Non-Taxable Items
21-680 Entitlement to foreign income tax offset
If the fund received assessable franked distributions from a New Zealand franking company directly or indirectly through a partnership or trust, show the amount of Australian franking credits attached to the distributions that are included in assessable income at label E. To work out whether the distribution is assessable refer to the Foreign income return form guide on the ATO website.
For ATO instructions when completing label E refer to Australian franking credits from a New Zealand company on the ATO website.
Use the Foreign income worksheet (for) to integrate Australian franking credits from a New Zealand company amounts to the return. Refer to Foreign income worksheet (for).
CCH References
4-100 Taxation of Dividend Recipients
4-400 Summary of imputation system
4-490 Trans-Tasman triangular imputation rules
13-160 Franking credit
For ATO instructions when completing label F refer to Transfers from foreign funds on the ATO website.
CCH References
13-125 Assessable income and contributions
13-125 Transfers from foreign superannuation funds
13-220 Taxation of non-complying funds
13-250 Taxation of foreign superannuation funds
For ATO instructions when completing label H refer to Gross payments where ABN is not quoted on the ATO website.
Gross payments where ABN not quoted amounts integrate from the MYOB Tax Payment Summary Schedule (PS) where the Income type is ‘B’ and the Payment type is ‘N’. Refer to Payment summary schedule (PS).
The Non-Individual Payment Summary is not deleted using Preparation > Delete schedules. To clear the payment Summary and values integrated to the return, open the schedule and delete the details from it. If you wish to retain the text, then delete the values from the $ amount fields only.
CCH References
33-130 Quoting an ABN
Use the Distributions from Partnerships worksheet (dfp) to enter details of income, shares of credits and deductions directly relating to the distribution. The entries are totalled and integrated to the relevant labels in the return. Refer to Distributions from partnerships worksheet (dfp).
If what you show at label I includes an amount brought to account under the TOFA rules, also complete item 16 Taxation of financial arrangements (TOFA).
For ATO instructions and notes when completing label I refer to Gross distributions from partnerships on the ATO website.
Refer to Guide to the taxation of financial arrangements (TOFA) rules on the ATO website.
For ATO instructions when completing label J refer to Unfranked dividend amount on the ATO website.
Use the Dividends Received worksheet (div) to enter Unfranked dividends received amounts and integrate to the return. Refer to Gross dividends worksheet (div).
Dividends – Notes for completing the dividend labels
Refer to these notes on completing dividend labels on the ATO website.
Refer to Guide to the taxation of financial arrangements (TOFA) rules on the ATO website.
CCH References
4-100 Taxation of Dividend Recipients
10-005 Checklist of Taxable and Non-Taxable Items
10-490 Dividends and Distributions
For ATO instructions and notes when completing label K refer to Franked dividend amount on the ATO website.
Use the Dividends Received worksheet (div) to enter the Franked dividends received amounts and integrate to the return. Refer to Gross dividends worksheet (div).
CCH References
4-100 Taxation of Dividend Recipients
10-005 Checklist of Taxable and Non-Taxable Items
10-490 Dividends and Distributions
For ATO instructions and notes when completing label L refer to Dividend franking credit on the ATO website.
Use the Dividends Received worksheet (div) to enter the Dividend Franking Credit amounts and integrate to the return. Refer to Gross dividends worksheet (div).
For general information refer to completing dividend labels and Guide to the taxation of financial arrangements (TOFA) rules on the ATO website.
CCH References
4-100 Taxation of Dividend Recipients
10-005 Checklist of Taxable and Non-Taxable Items
10-490 Dividends and Distributions
For information refer to Distributions from trusts and Label N Trust distributions unfranked amount on the ATO website.
To complete label N enter all details in the Distributions from Trusts worksheet (dft). The amounts entered will be totalled and integrated to the relevant labels in the return. The worksheet also provides for the separation of arm’s length and non-arm’s length income as these amounts are to be disclosed at different labels in the fund return. Refer to Distributions from Trusts worksheet (dft).
Consider whether any distributions received from a trust are part of a non-arm’s length arrangement and whether the distribution received is greater than what might otherwise have been expected had the parties been dealing with each other at arm’s length. Refer to Taxation Ruling TR 2006/7 for further information. If the distributions received are non-arm’s length amounts, do not show the distributions at labels N to Q. These distributions must be included at label U Net non-arm’s length income.
For information refer to Distributions from trusts and Label O Trust distributions franked amount on the ATO website.
To complete label O enter all details in the Distributions from Trusts worksheet (dit). The amounts entered will be totalled and integrated to the relevant labels in the return. The worksheet also provides for the separation of arm’s length and non-arm’s length income as these amounts are to be disclosed at different labels in the fund return. Refer to Distributions from Trusts worksheet (dft).
Consider whether any distributions received from a trust are part of a non-arm’s length arrangement and whether the distribution received is greater than what might otherwise have been expected had the parties been dealing with each other at arm’s length. Refer to Taxation Ruling TR 2006/7 for further information. If the distributions received are non-arm’s length amounts, do not show the distributions at labels N to Q. These distributions must be included at Label U-Net non-arm's length income. Refer to the online help at item U for further details.
Include any franking credit at label P and for:
Complying superannuation funds: Show the amount of franking credit attached to such dividends at label E1 Complying funds franking credits tax offset item 12.
Non-complying superannuation funds: Show the amount of franking credit attached to such dividends at label C2 Rebates and tax offsets item 12.
For information refer to Distributions from trusts and Label P Trust distributions franking credit on the ATO website.
To complete label P enter all details in the Distributions from Trusts worksheet (dft). The amounts entered will be totalled and integrated to the relevant labels in the return. The worksheet also provides for the separation of arm’s length and non-arm’s length income as these amounts are to be disclosed at different labels in the fund return. Refer to Distributions from Trusts worksheet (dft).
For information refer to Distributions from trusts and Label Q Trust distributions other amounts on the ATO website.
To complete label Q enter all details in the Distributions from Trusts worksheet (dit). The amounts entered will be totalled and integrated to the relevant labels in the return. The worksheet also provides for the separation of arm’s length and non-arm’s length income as these amounts are to be disclosed at different labels in the fund return. Refer to Distributions from Trusts worksheet (dft).
The amount at R is automatically calculated and is the result of:
R1 Assessable employer contributions.
R2 Assessable personal contributions.
R3 No TFN Quoted contributions.
Less:
R4 Contributions excluded by trustee.
R5 Pre-1 July 1988 funding credits.
R6 Transfer of liabilities to life insurance company or PST.
For ATO instructions when completing label R refer to Assessable contributions on the ATO website.
CCH References
13-050 Superannuation funds
13-125 Assessable Income and Taxable Contributions
Calculation of Assessable Contributions
Generally, the liability for tax on contributions lies with the trustee of a fund receiving the contributions. Australian superannuation funds are entitled to deduct the costs of collecting all contributions. The deductions for expenditure incurred by an Australian superannuation fund are not reduced because it received non-taxable contributions - for example, non-deductible employer contributions. However, foreign superannuation funds are only entitled to a deduction for the cost of collecting assessable contributions.
For ATO instructions when completing label R1 refer to Assessable employer contributions on the ATO website.
CCH References
13-050 Superannuation funds
13-100 Complying and regulated fund status
13-120 Taxation of complying superannuation entities
13-125 Assessable Income and Taxable Contributions
For ATO instructions when completing label R2 refer to Assessable personal contributions on the ATO website.
For contributions caps, refer to Contributions caps on the ATO website.
CCH References
13-050 Superannuation funds
13-100 Complying and regulated fund status
13-120 Taxation of complying superannuation funds
13-125 Assessable Income and Contributions
For ATO instructions when completing label R3 refer to No-TFN quoted contributions on the ATO website.
The fund will be liable for additional tax on no-TFN- quoted contributions. For a complying superannuation fund, the additional tax is 32% (that is, in addition to 15%). For a non-complying superannuation fund, the additional tax is 2% (that is, in addition to the 45% tax). The effect of the additional tax is that the no-TFN-quoted contribution is subject to an overall tax rate of 47%. This additional tax must be paid regardless of any tax offsets or amounts the fund may have transferred to a life insurance company or PST.
Show additional tax payable because a member did not quote a TFN at J Tax on no-TFN-quoted contributions item 12.
If a member quotes their TFN to the fund in 2017–18 for the first time, and the fund paid additional tax (32% for complying superannuation funds; 2% for non-complying superannuation funds) on no-TFN- quoted contributions in one of the most recent three income years, in relation to that member not having quoted, then a tax offset can be claimed at E2 No-TFN tax offset item 12 for that additional tax.
Also refer to the information at item E2 No-TFN tax offset in the ATO Fund instructions.
CCH References
13-050 Superannuation funds
13-180 Tax on no-TFN contributions
For ATO instructions when completing label R4 refer to Contributions excluded by Trustee on the ATO website.
CCH References
13-050 Superannuation funds
13-180 Tax on no-TFN contributions
For ATO instructions when completing label R5 refer to Pre-July 1988 funding credits on the ATO website.
CCH References
13-050 Superannuation funds
For ATO instructions and examples when completing label R6 refer to Transfer of liability to a life insurance company on the ATO website.
CCH References
13-050 Superannuation funds
13-125 Transfer of assessable contributions
Show at label G assessable foreign exchange gains (from both foreign and domestic sources) made by the fund.
Refer to Foreign exchange gains on the ATO website.
CCH References
10-140 Foreign exchange and futures transactions
For ATO instructions and examples when completing label S refer to Other income on the ATO website.
Other income worksheet (oti) and Depreciation worksheet (d)
Other income amounts integrate to label S from the Other Income worksheet (oti). Refer to Other income worksheet (oti).
The oti provides a list of relevant income codes, a description and amount field and this set of fields is repeatable. Click [Ctrl+Ins] to create additional rows. On integration Tax calculates the code to be returned at the code box as being the code that represents the largest income amount.
Worksheet amounts that integrate to the oti are:
Assessable balancing adjustments calculated in the Depreciation worksheet (d).
Gross payments subject to foreign resident withholding in the Payment summary schedule (PS).
Refer to the Guide to the taxation of financial arrangements (TOFA) rules on the ATO website.
Refer to the ATO electronic Guide to depreciating assets for more information.
CCH References
13-050 Superannuation funds
13-100 Complying and regulated fund status
13-120 Taxation of complying superannuation funds
13-125 Assessable Income and Contributions
13-220 Taxation of non-complying funds
13-250 Taxation of foreign superannuation funds
13-270 Former foreign superannuation funds
22-000 Tax Liability of Non-residents
Show at label T the amount that is to be included in the fund's assessable income because of a change in tax status of the fund.
For ATO instructions and examples when completing label T refer to Assessable income due to changed tax status of fund on the ATO website.
CCH References
13-050 Superannuation funds
13-100 Complying and regulated fund status
13-120 Taxation of complying superannuation funds
13-170 Non-arm’s length income
Show at label U the net amount of income which a fund, ADF or PST has received from a transaction or a series of transactions between parties that is non-arm’s length income.
For ATO instructions and examples when completing label U refer to Net non-arm’s length income on the ATO website.
Carried forward losses
Press [Enter] or [Alt+S] at label U to open the Net non-arm’s length income and deduction worksheet (nai) which also is filled from the Distributions from Trusts worksheet (dft). As Net arm’s length losses need to be quarantined for use in a subsequent year against income of the same class, the nai provides functionality to store the loss and carry it forward from one year to the next.
CCH References
13-050 Superannuation funds
13-100 Complying and regulated fund status
13-120 Taxation of complying superannuation funds
13-170 Non-arm’s length income
The Gross income of a complying superannuation fund derived from assets held to provide for current 'pension liabilities' is exempt from income tax.
For ATO instructions and examples when completing label Y refer to Exempt current pension income on the ATO website.
CCH References
13-140 Exempt current pension income