# Section D: Calculation Statement

## Item 12

The Calculation Statement works out the tax liability where there is taxable income.

Refer to the ATO website for:

Labels 12/A, T1, J, B, C, T2, D, T3, E, T5, G, H, I, K, S represent the right-hand column of the Calculation Statement. Excepting label G Section 102AAM interest charge, the amounts for these labels are determined from values integrated from return labels and MYOB Tax worksheets and are edited via those worksheets.

### PAYG Income instalment estimate

From the information entered in the calculation statement, Tax provides an estimate of current year tax payable.

Additionally, the information provided at certain labels of the calculation statement is used to calculate the commissioner's instalment rate for quarterly and annual payers under the PAYG income instalment system for the next income year and the GDP-adjusted instalments. It is important to complete all labels as accurately as possible to ensure that the rate calculated results in a reliable estimate of tax payable for the current income year.

Tax provides a PAYG instalment estimate when you click [F4].

Alternatively, to produce the estimate at the time of printing the return select Reports > Print Return.

For PAYG what-if scenarios, select PreparationSchedule > PAYG (Instalment income estimate) or code pgF.

CCH References

21-130 Listed countries

21-190 Attribution of CFC income to attributable taxpayers

21-200 Attributable income of a FC

21-310 Attributable taxpayers - non-resident family trusts

21-360 Foreign investment funds

21-670 Scope of FITO rules

21-680 Entitlement to foreign income tax offset

22-072 Capital gains withholding regime for foreign residents

Label A - Taxable income

Taxable income is automatically calculated by Tax from values entered in the Income and Deductions sections of the return and is the amount calculated at label O Taxable income or loss if positive. A zero will be defaulted to label O where the fund has no income or has sustained a loss.

T1 Tax on taxable income is calculated by MYOB Tax.

For more information and examples refer to Tax on taxable income on the ATO website.

Label J - Tax on No TFN quoted contributions

Shown at label J No-TFN quoted contributions tax is the amount of additional tax payable on no-TFN quoted contributions shown at R3 No-TFN quoted contributions.

Refer to Tax on No-TFN-quoted contributions on the ATO website.

Also refer to Example 4, Superannuation fund showing income at R3 No TFN quoted contributions item 10 in the Fund instructions on the ATO website.

The additional tax shown at label J No-TFN quoted contributions tax is also included at label B Gross tax. MYOB Tax automates the calculation of Gross Tax at label B.

Label B - Gross tax

Gross tax is automatically calculated by Tax based on the Taxable Income at item 11 label O where the amount is positive.

The compliance status of a fund affects the tax rates that apply. If the fund is a regulated superannuation fund, ADF or PST and you have not received a Notice of Non-Compliance from APRA, then the fund is a complying fund and the standard tax rate is 15%. If the fund is a non-complying fund, the standard rate of tax is 45%.

However, different tax rates apply to the following types of income and Tax will automatically calculate the correct rate of tax for the following types of income:

• Contributions shown at label R3 no-TFN quoted contributions item 10. An additional 32% tax plus 2% Medicare levy for complying funds and an additional 2% Medicare levy for non-complying funds, making overall tax payable on no-TFN contributions 47%.

• Net non-arm's length income shown at label U Net non-arm's length income item 10. Tax is calculated at 45%.

• Assessable income due to fund tax change in status shown at label T Assessable income due to changed tax status of fund item 10. Tax is calculated at 45%.

If the fund is a complying fund, the standard rate of tax will be 15% and if a non-complying fund the rate of tax will be 45%.

However, if the fund is in receipt of the following types of income:

TFN not quoted contributions shown at label R3 No TFN quoted contributions item 10

Net non-arm's length income shown at label U Net non-arm's length income item 10

Assessable income due to fund tax change in status shown at label T Assessable income due to changed tax status of fund item 10

You must ensure that the correct rate of tax is applied to each type of income when completing label B.

Refer to Label B Gross Tax on the ATO website. And, refer to Example 5 and Example 6 instructions on that ATO page.

CCH References

42-035 Superannuation Fund Rates

Label C1 - Foreign income tax offsets

The amount to be shown at label C1 is the fund’s self-determined foreign income tax offset.

Foreign income worksheet (for)

Use the Foreign income worksheet (for) worksheet to record the previous five years excess foreign income tax which will be required for the correct calculation of the foreign income tax offset entitlement for the current year. If the offset entitlement calculated exceeds Gross tax payable, you must limit the offset so that Gross Tax payable is no less than NIL.

Foreign income tax offsets are calculated in the Foreign income worksheet (for) and integrate to item 21 and from that item to label C1.

Refer to Foreign income tax offsets on the ATO website.

For more information on calculating foreign income tax offsets, refer to the Guide to foreign income tax (NAT 72923) available on the ATO website.

If the fund received franked distributions directly from a New Zealand franking company, refer to Trans-Tasman imputation in the ATO Fund instructions.

CCH References

21-670 Foreign income tax offsets

Label C2 - Rebates and tax offsets

Show at label C2 the total of rebates and tax offsets available and not the amounts giving rise to that tax rebate or tax offset.

Holding dialog

The holding dialog at label C2 is filled from values entered at return labels in accordance with the Status of the fund. If the fund is complying then integration of franking credits amounts is directed to label E1.

Refer to Rebates and tax offsets on the ATO website.

Label T2 - Subtotal (B less C)

This subtotal is the result of deducting the sum of labels C1 Foreign income tax offset and C2 Rebates and tax offsets shown at label C Non-refundable non-carry forward tax offsets from label B Gross tax. The amount at label T2 cannot be negative.

If the amount at label C Non-refundable non-carry forward tax offsets is more than or equal to the amount at label B Gross tax, a zero will be defaulted to both Subtotals T2 and T5 Tax payable. The remainder will be defaulted to label E Refundable tax offsets.

For more information and example 7 refer to T2 - Subtotal 1 on the ATO website.

Label D - Non-refundable carry forward tax offsets. This is the sum of labels D1, D2, D3 and D4.

If the total of the non-refundable carry forward tax offsets at D is greater than the remaining tax at T2, the excess may be carried forward to a future income year. If the amount at T2 is greater than the total of the non-refundable carry forward tax offsets at D, the remaining tax is shown at T3 Subtotal 2.

Write at D the total of:

• D1 Early stage venture capital limited partnership tax offs
• D2 Early stage venture capital limited partnership tax offset carried forward from previous year
• D3 Early stage investor tax offset, and
• D4 Early stage investor tax offset carried forward from previous year.

CCH References

20-700 Outline of innovation incentives

Labels D1 and D2 - Early stage venture capital limited partnership tax offset (ESVCLP)

This offset is a non-refundable carry forward tax offset. The esv worksheet at labels D1 and D2 is designed for record keeping purposes and for managing the carrying forward of any excess ESVCLP tax offset not claimed in the current year. Click the label to open the worksheet.

CCH References

20-700 Outline of innovation incentives

Labels D3 and D4 - Early stage investor tax offset (ESIC)

This offset is a non-refundable carry forward tax offset. The esi worksheet at labels D3 and D4 is designed for record keeping purposes and for managing the carrying forward of any excess ESIC tax offset not claimed in the current year. Click the label to open the worksheet.

CCH References

20-700 Outline of innovation incentives

Label T3 - Subtotal (T2 less D)

Show at T3 the subtotal of tax payable after D Non-refundable carry forward tax offsets has been offset against T2 Subtotal 1. The amount at label T3 cannot be negative.

Refer to Rebates and tax offsets on the ATO website.

CCH References

13-160 Tax offsets, losses and other concessions

Label E1 - Complying funds franking credits tax offsets

[Enter] at Label E1 to open the holding dialog which is filled from the amounts entered at income item 10 labels L and E and from the Distributions from Trusts worksheet (dft) and the Distributions from partnerships worksheet (dfp).

Integration at label E1 is based on the Status of the Fund. If the fund is non-complying, integration will be to C2.

Refer to Complying funds refundable franking tax offset on the ATO website.

CCH References

4-820 Refund of excess franking credits

13-160 Franking credit

Label E2 - No-TFN tax offset

Show at label E2 the no-TFN tax offset claimed.

Press [Enter] to open the Interest on no-TFN tax offset worksheet (ito) may be used to calculate both the no-TFN tax offset at E2 and the interest due on that overpayment of tax at H6. Press [Enter] at the Label to open this worksheet.

For more information and example 8 refer to No-TFN tax offset on the ATO website.

CCH References

13-180 Tax on no-TFN contributions

Label E3 - National rental affordability scheme tax offset

Show at label E3 the amount of National rental affordability scheme tax offset entitlement.

Refer to National rental affordability scheme tax offset on the ATO website.

The NRAS is designed to encourage large-scale investment in affordable housing. The NRAS offers incentives to providers of new dwellings on the condition that they are rented to low and moderate income households at 20% below market rates.

The refundable tax offset is only available where the Housing Secretary from the Department of Social Services has issued a certificate under the NRAS. In order to claim the offset in the current income year, the NRAS certificate must relate to the NRAS year comprising the period 1 May 2018 to 30 April 2019.

Press [Enter] or click the label to open the holding dialog at E3. Also, refer to Distributions from partnerships worksheet (dfp) and Distributions from Trusts worksheet (dft).

CCH References

20-600 National Rental Affordability Scheme

20-605 NRAS Refundable Tax Offset

Label E4 - Exploration credit tax offset

Show at E4 the amount of exploration credits received during the income year.

A fund may be entitled to a tax offset for exploration credits received during the income year if it was an Australian resident for the whole of the income year.

The amount of the tax offset is the total value of exploration credits the fund received in the income year. However, special rules may apply where the fund has received exploration credits from a partnership or a trust.

The holding dialog at E4 in the Calculation Statement has been introduced to collect any amount of Exploration credits received from a Partnership or Trust; and to enter any amount of Exploration credits received by the Fund due to the Fund's investment in an eligible Mining Exploration company.

For more information, see What to do when you receive exploration credits on the ATO website. Also refer to Division 418 of the Income Tax Assessment Act 1997.

Integration from MYOB Tax worksheets to this worksheet are:

• Amounts received as a distribution from a Partnership at item 10 (dfp)

• Amounts received as a distribution from another Trust at item 10 (dft)

• Credits received from a Greenfields mining company in lieu of a franking credit).

CCH References

19-000 - Mining, Infrastructure and environmental protection

Label G - Section 102AAM interest charge

Show at label G the amount of interest calculated under section 102AAM in respect of 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.

Refer to the ATO publication, Foreign income return form guide.

Label H1 - Credit for interest on early payments (excluding capital gains)

Show at label H1 only the calculated interest amount of 50 cents or more for early payments. Do not show payment amounts.

The Interest on Interest on early payments worksheet (epi) may be used to calculate the interest credit and integrate it to the label.

For more information and example 8 refer to Credit for Interest on early payments on the ATO website.

CCH References

25-440 Interest on Early Payments

Label H2 - Credit for tax withheld - foreign resident withholding

Show at label H2 the total amount of tax withheld from payments subject to foreign resident withholding (FRW). This includes any distributed share of FRW credits distributed to the fund from a partnership or trust.

Amounts integrate to a holding dialog from:

Press [Enter] at the Label to open the dialog from which you may access these worksheets.

Any credit distributed from a Managed Investment Trust Fund will also be shown at this label.

Refer to Credit for tax withheld - foreign resident withholding on the ATO website.

CCH References

22-000 Tax liability of non-residents

Label H3 - Credit for tax withheld - where ABN or TFN not quoted (non-individual)

Refer to Credit for tax withheld - where ABN or TFN not quoted on the ATO website.

1. Press [Enter] or click label H3 to open the holding dialog.

2. The holding dialog collects relevant amounts of income and related credits from the following schedules and worksheets:

• Interest worksheet (int).

• The Income type is B, and

• The Payment type is N.

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.

1. The dialog contains an open field for the entry of Other TFN withheld where one or more worksheets are not used.

2. These amounts are totalled and integrated to label H3.

CCH References

33-030 TFNs and investments

33-130 Quoting an ABN

Label H5 - Credit for TFN amounts withheld from payments from Closely Held Trusts

Show at label H5 the total amounts withheld from payments where you have not provided your TFN to the trustee of a closely held trust.

Refer to Credit for TFN amounts withheld from payments from closely held trusts on the ATO website.

#### Holding Dialog

1. [Enter] at the Label to open the holding dialog.

2. The dialog is filled from the amounts entered in or distributed to:

Where withholding applies, the trustee of a closely held trust is required to provide beneficiaries with an annual payment summary in the approved form.

For more information regarding the TFN withholding rules for closely held trust refer to TFN withholding for closely held trusts.

Label H6 - Credit for interest on no-TFN offset

If you have completed the Interest on no-TFN tax offset worksheet (ito) at E2, any interest on no-TFN credit will have been calculated and integrated to H6. To open the worksheet, click label H6.

Refer to Credit for interest on no-TFN tax offset on the ATO website.

For information on calculating the interest to be applied on tax that counts towards refer to No-TFN tax offset on the ATO website.

CCH References

13-180 Tax on no-TFN contributions

Label H8 - Credit for foreign resident capital gains withholding amounts

Show at label H8 the total amount of tax withheld from payments to the Fund that were subject to foreign resident capital gains withholding in Australia. Include at H8 the Fund's share of foreign resident capital gains withholding credits distributed to the Fund from its share of net income from a trust

You should only claim at H8 a credit equal to the amount of foreign resident capital gains withholding paid by a purchaser to the ATO on your behalf. The ATO would have issued you with confirmation of this amount.

Do not include credits for amounts withheld from foreign resident withholding (excluding capital gains) at H8. Include these at H2 Credit for tax withheld - foreign resident withholding (excluding capital gains).

CCH References

22-072 Capital gains withholding regime for foreign residents

Label K - PAYG instalments raised

The amount to complete this field is stored in the Return Properties PAYG/Lodge tab. If there is no amount at label K, press [Enter] to open the PAYG/Lodge tab.

Depending on how you lodge Activity Statements for your clients, and whether you prepared the client’s prior year income tax return, PAYG Instalments paid for the first, second and third quarters will have been rolled over to the fields on the PAYG/Lodge tab.

Use amounts from the GST/PAYG Profile

If you lodge Activity Statements on behalf of your clients, the GST Profile and, consequently, the Return Properties PAYG/Lodge tab will be updated with PAYG Income Tax Instalments (PAYGITI) paid and the sum of Quarters 1 to 4 will be included in the Estimate calculated by Tax as a credit if positive and a debit if negative.

Quarters 1, 2, 3: If amounts have not defaulted to this field from the GST Profile, the total of them may be keyed, where no GST/PAYG Profile was maintained in the previous year or where the client is new to the Practice.

Quarter 4 / Annual: This is the amount of the final instalment for the previous year. It will default from the Instalment tab found by clicking Preparation > GST/PAYG Profile and is derived as:

• The Q4 5A amount less the Q4 5B amount plus.

• The Annual 5A amount less the Annual 5B amount.

Use manually calculated value

If you do not use Tax to prepare and lodge Activity Statements on behalf of your clients and you do not update the GST/PAYG Profile Instalment Tab manually with the amount of Instalment tax paid, then you can key the amount to be included in the Estimate calculated by Tax. If the amount is negative, precede the value with a hyphen (-). The amount keyed as Total PAYG Instalments paid should be the total amount for the 4 Quarters whether they have been paid or not.

Refer to PAYG Instalments raised on the ATO website.

CCH References

27-100 PAYG Instalments

Label S - Total amount due or refundable

The amount at label I will be automatically calculated by Tax and is the result of labels T5 plus G less H less I less K.

Refer to Amount due or refundable on the ATO website.

CCH References

42-035 Superannuation Fund Rates

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