How does the tax code work in Australia?

The system of tax code in Australia is a series of pieces of legislation which govern the various taxes that are levied by governments in Australia. The taxation levied by State governments is regulated through state legislatures, but the system of federal taxation is created ultimately under the taxation power found in section 51 of the Australian Constitution. The major pieces of legislation include:

1. INCOME TAX ASSESSMENT ACT 1936 (Cth) – Original Income Tax legislation
2. INCOME TAX ASSESSMENT ACT 1997 (Cth) – Updates to the Income Tax System
3. INTERNATIONAL TAX AGREEMENTS ACT 1953 (Cth) – Provisions preventing double taxation and givining international treaties for taxation domestic effect.
4. TAXATION ADMINISTRATION ACT 1953 (Cth) – Operation of the Taxation Administration System.
5. A NEW TAX SYSTEM (GOODS AND SERVICES TAX) ACT 1999 – Operation of the GST; and
6. SUPERANNUATION GUARANTEE (ADMINISTRATION) ACT 1992 – Requirement for the payment of superannuation.

In terms of indentifying how the major aspects of the tax code work by which parts are authoritative over which in the case of an inconsistency between parts, the constitution does provide for the commonwealth power of taxation and everything is interpreted in this regard. However, th next most authoritative instrument beneath the constitution is the acts themselves and then the regulations. After the regulations there is case law assisting in the interpretation of the relevant legislation. Beyond this, there are materials which can provide guidance but will not have legal effect such as the determinations of tribunals such as the Administrative Appeals Tribunal, the Interpretative decisions of the ATO, Public and Private Rulings made by the ATO and then there are other materials produced by the ATO which have no legal authority at all and are simply intended to guide the public on the interpretation of the tax law. The statements may include documents such as the Bulletins, case decision summaries, law administration practice statements, decision impact statements and ATO views. In some ways, it is extremely confusing that there are so many sources of possible authority in relation to the tax law. However it is necessary to keep in mind the major soucres of ultimately legal authority being the constitution, the legislation and regulations along with the case law of courts vest with appropriate powers under Chapter III of the Constitution and the Judiciary Act (Cth).

If your have any questions about how the tax code operates you can post your query to the contact form to the right and then you can also chat to a tax lawyer online now if you would like. Alternatively, you can post your legal question to the question box below and a lawyer should answer you immediately.