07 Jun 077 Withholding tax: sublease of substantial equipment by a Singaporean resident to Australian entity - TD 2007/D12This draft Taxation Determination was released on 6 June 2007 for public comment by 6 July 2007. Its full title is "Income tax: is a non-resident head lessor of substantial equipment liable for royalty withholding tax under s 128B(5A) of ITAA 1936 on lease payments it receives from a Singaporean resident who subleases that same equipment to an entity which operates it in Australia?" The answer given is as follows:
"Yes, the non-resident head lessor will be liable for royalty withholding tax under s 128B(5A) of ITAA 1936, except where the non-resident head lessor is a resident of the United States (US) or the United Kingdom (UK) for tax treaty purposes or has a permanent establishment in Australia under one of Australia's tax treaties."
For a copy of TD 2007/D12, go here