Application of repayment thresholds for overseas-based borrowers

(Clause 32)

Summary of proposed amendment

A transitional provision will make it explicit that the repayment thresholds for overseas-based borrowers introduced in 2014 apply to income tax years beginning on 1 April 2014 and later, as was intended.

Application date

The amendment applies to income tax years starting on 1 April 2014.

Key features

A “savings” provision in proposed clause 18 in part 3 of schedule 6 of the Student Loan Scheme Act 2011 ensures that previous amendments to repayment obligations of overseas-based borrowers do not apply to tax years that commenced before 1 April 2014. Instead, the previous repayment obligations apply to those years.

Background

New repayment thresholds for overseas-based borrowers introduced in the Student Loan Scheme Amendment Act 2014 were intended to apply for the tax years commencing on and after 1 April 2014, but that was not made explicit in the legislation. The effect was that the new rules could be applied to the assessment of repayment obligations for tax years prior to 1 April 2014, when the actual assessment is carried out after 1 April 2014.