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Access: Company return > Calculation Statement

This statement works out the tax liability (if any) taking account of amounts which reduce the tax liability.

The outcome is the net amount the company must pay or the ATO will refund.

The ATO and MYOB Tax use the information provided at certain labels of the Calculation statement to calculate the Commissioner's instalment rate and the Commissioner's instalment amount for taxpayers under the PAYG instalment system for the next income year (read: PAYG Instalment Income Worksheet (pgC) - Form C for MYOB's calculation methodology).

MYOB Tax pre-fills the labels in the Calculation Statement from information entered elsewhere in the return either at labels or in MYOB Tax worksheets. The worksheets and dialogs behind the labels indicate where an amount may be manually entered by the preparer. In the right-hand column, these labels are C Non-refundable, non-carry forward tax offsets, D Non-refundable carry forward tax offsets, and E Refundable tax offsets.

Label H Eligible credits, in the right-hand column, requires certain labels in the left-hand column to be completed so that the total (or the reduced total where required) can be integrated at the appropriate label.

Priority of use of tax offsets

  1. The first category of tax offsets to be applied against gross tax is C Non-refundable non-carry forward tax offsets. As the name of this category suggests, if the offsets are greater than the gross tax, the excess offsets cannot be used and are lost.

  2. Should tax still be payable after applying this category of offsets, at T2 Subtotal 1, the second category, D Non-refundable carry forward tax offsets, is applied against any remaining tax payable at label T2. Note that the early stage investor tax offset is applied after all other non-refundable carry forward offset but before the early stage venture capital limited partner tax offset.

  3. Any excess of offsets in this category may be carried forward to the next year (subject to the tax offset carry forward rules in Division 65 of the ITAA 1997). If tax is still payable after application of the Non-refundable carry forward tax offsets, T3 Subtotal 2, the third category E Refundable tax offsets is applied against the tax remaining. Any excess of refundable tax offsets above the residual tax payable in T3 becomes part of the credits available to you and is shown at I Remainder of refundable tax offsets.

  4. If tax is still payable at T4 Subtotal 3 after applying tax offsets from the above three categories,

    1. F Franking deficits tax offsets are applied against this remaining tax to determine your tax payable amount.

    2. Any excess of F over the residual tax payable at T4 may be carried forward to a later income year.

 

Label A - Taxable income

MYOB Tax transfers this amount from label T, Taxable income or loss. Where the amount at label T is a loss, a zero will be returned at this label. Income of $1 or more will be shown.

Label T1 - Tax on taxable income

MYOB Tax calculates this amount in accordance with the Company type and any special income that is taxable at a higher or lower rate than the standard company tax rate of 30%.

From 1 July 2018 the rate of tax for small business entities tax is reduced to 27.5%. This is the amount of tax payable before the application of R&D recoupment tax. For the tax rates applying to companies select Maintenance > Tax Rates > Company.

For 2018 tax returns, refer to Base rate entity eligibility tests worksheet (bre).

Label M - R&D recoupment tax

Show at label M the extra tax required on your recoupment as calculated under Subdivision 355-G of the ITAA 1997.

Click label M to open the schedule BY, refer to Research and development tax incentive (BY) .

If you have claimed the R&D tax incentive at item 21 and you have received or become entitled to receive a government recoupment (such as a government grant or reimbursement) that relates to expenditure that you have claimed a notional deduction for under the R&D tax incentive, the income tax you are liable to pay on the recoupment will be increased. This is referred to as a clawback adjustment. The amount to be shown at label M is 10% of both the following:

  • The R&D expenditure and decline in value for which you claimed a notional deduction in relation to the recoupment.

  • The expenditure and decline in value for which your affiliates and entities connected with you claimed a notional deduction in relation to the recoupment.

The clawback adjustment is capped so that the extra tax payable cannot exceed the amount of the grant you received.

For information about how this amount is calculated, refer to the fact sheet for clawback adjustment on the Research and development tax incentive home page.

CCH References

20-165 R&D - Activities and Entities

20-180 Clawback of recoupments and Feedstock recoveries

20-185 Applying R&D to Associates, R&D Partnerships and CRCs

Label B - Gross tax

MYOB Tax calculates the Gross Tax which is the sum of Tax on Taxable income at T1 plus R&D recoupment tax at label M. It is the amount of tax payable before the application of allowable offsets and credits.

Label C - Non-refundable non-carry forward tax offsets

Show at label C the total of actual tax offsets available - in dollars and cents - and not the amounts giving rise to those tax offsets.

Click label C to open the Non-Refundable non-carry forward tax offsets worksheet (nro) . This worksheet collects values entered at various labels in the main return.

Where there is an Excess franking credit, the excess is considered a deemed loss to be carried forward to a future year. When entered at item 8 label H, Tax will calculate the amount of the deemed loss and include it in the Prior Year loss worksheet (pyl) to be carried forward for use in a subsequent year.

CCH References

4-820 Refund of excess franking credits

15-005 Tax offset finding table

Table T2 - Subtotal 1

This is the result of Gross tax less Non-refundable non-carry forward tax offsets and may not be negative. If the result is negative, a zero will be shown.

Label D - Non-refundable carry forward tax offsets

A 'holding' dialog is provided at this label to collect values entered at labels in the main return, the Non-refundable carry forward R&D tax offsets from item 21 labels A and B.

The tax offsets shown at label D are not refundable. They are only offset against gross tax to reduce it to zero, if there is any gross tax to be paid after label C Non-refundable non-carry forward tax offsets has been applied to gross tax. Any excess offsets can be carried forward to the next income year (subject to the tax offset carry forward rules in Division 65 of the ITAA 1997).

Click label D to open the Non-Refundable carry forward tax offsets worksheet (ncf).

Table T3 - Subtotal 2

This is the result of T2 Subtotal 1 less Non-refundable carry forward tax offsets and may not be negative. If the result is negative, a zero will be shown.

Label E - Refundable tax offsets

The holding dialog provided at this label collects values entered at labels in the main return and other values that integrate from worksheets such as the no-TFN offset that integrates from the ito worksheet. The Franking offset and Franking credit fields referable to LICs or tax exempt entities will be populated from data entered in the Non-refundable non-carry forward tax offset at label C.

Due to the refundable tax offset rules in Division 67 of the ITAA 1997, the refundable R&D tax offset directly reduces tax payable by a company. This includes income taxes, GST, FBT and withholding taxes. Where the amount of the refundable R&D tax offset exceeds the amount of tax that the company would otherwise have had to pay, then the excess is refundable.

Click label E to open the Refundable tax offsets worksheet (rto).

Label T4 - Subtotal 3

This is the result of Subtotal 2 T3 less Refundable tax offsets E 

Label F - Franking deficit tax offset

The tax offsets shown at label F are not refundable - they are only offset against gross tax to reduce it to zero, if there is any gross tax to be paid after labels C, D and E have been applied to gross tax. Any excess of FDT offset can be carried forward to the next income year.

Refer to the current year ATO Company instructions for Franking deficit tax.

Click label F to open the Franking Deficit tax offset worksheet (fdt).

ATO website

Refer to the fact sheet and its table of contents Simplified imputation: Franking deficit tax offset.

For special rules for late balancing entities refer to the fact sheet and its table of contents Simplified imputation - FDT offset for late balancers (NAT 10164).

More information on how to calculate the amount of FDT offset for life insurance companies is available on the ATO website.

CCH References

4-780 Liability to franking deficit tax

Label T5 - Tax payable

MYOB Tax calculates this amount which may not be negative.

Label G - Section 102AAM interest

This is for any s102AAM interest relating to a distribution received from a non-resident trust. Section 102AAM of the ITAA 1936 imposes an interest charge on certain distributions from non-resident trusts.

Click label G to open the Generic Schedule / Worksheet.

Refer to chapter 2 of the publication Foreign Income Return Form Guide.

Label H - Eligible Credits

The Tax application calculates this amount from the amounts entered at labels H1, H2, H3, H4, H5, H7 and H8. See Label H - Eligible Credits.

Label I - Remainder of refundable tax offsets

MYOB Tax calculates this amount which only occurs when the amount at label E Refundable tax offsets is greater than the amount at T3 Subtotal 2.

Label K - PAYG instalments raised

Show at label K the total of the company's PAYG instalments for the income year of the tax return, whether the instalments have been paid or not.

Click label K to open the Return Properties PAYG/Lodge tab where these details are recorded from Activity statements lodged. If there is no value on the PAYG/Lodge tab, then you must enter it so that it is available to pre-fill label K.

Include in the total instalment amount either:

  • The amount(s) pre-printed at label T7 on its quarterly activity statements or at label T5 on its annual instalment activity statement, (if the company used the instalment amount/s worked out by the ATO which it did not vary), or

  • The amount(s) it reported at label 5A on its activity statement(s), reduced by any credit(s) it claimed at label 5B (if the company did not use the instalment amount/s worked out by the ATO).

CCH References

27-100 Introduction to PAYG instalments

Label S - Amount due or refundable

MYOB Tax Calculates this amount. The amount at label S does not take into account any interim or voluntary payments the company has made against its income tax liability for the year of this return. If the company has made such payments, take these into account in calculating the company's final payment but do not show the amounts on this tax return.

Send the company's payment to the address on the pre-identified payment advice. If the company has not received one refer to the current year ATO Company instructions.

Do NOT send the company's payment with the Company tax return.

 
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