Removal of Non-resident Interest Withholding Tax on Commonwealth Government Securities

10 December 2009

Legislation making Commonwealth Government Securities eligible for exemption from non-resident interest withholding tax (IWT) has come into effect following Royal Assent to the Tax Laws Amendment (2009 Measures No. 5) Act 2009 on 4 December 2009.

Interest payments on Commonwealth Government Securities are now exempt from IWT provided the securities satisfy the public offer test under section 128F of the Income Tax Assessment Act 1936. The following Commonwealth Government Securities on issue are considered to satisfy this requirement:

Treasury Bonds

Coupon Rate (%) Maturity Date ISIN
5.25 15 August 2010 AU300TB01216
5.75 15 June 2011 AU0000XCLWG7
5.75 15 April 2012 AU3TB0000010
6.50 15 May 2013 AU0000XCLWH5
6.25 15 June 2014 AU3TB0000028
6.25 15 April 2015 AU0000XCLWI3
6.00 15 February 2017 AU300TB01208
5.25 15 March 2019 AU300TB01224
4.50 15 April 2020 AU3TB0000036
5.75 15 May 2021 AU0000XCLWM5

Treasury Indexed Bonds

Coupon Rate (%) Maturity Date ISIN
4.00 20 August 2010 AU0000XCLWA0
4.00 20 August 2015 AU0000XCLWD4
4.00 20 August 2020 AU0000XCLWE2
3.00 20 September 2025 AU0000XCLWP8

The Australian Taxation Office has advised the Australian Office of Financial Management that the Commonwealth Government Securities listed above satisfy the public offer test under subsection 128F(3) of the Income Tax Assessment Act 1936 to the extent that subsection 128F(5) of the Act does not apply.

  • Subsection 128F(5) relates to the acquisition of securities by associates of the issuer. The Commonwealth is not aware, and has no grounds to suspect, that any of the securities listed above have been or will be acquired by associates of the Commonwealth in circumstances that would be covered by the provisions of the subsection. Accordingly, the subsection does not apply to these securities.

It continues to be the case that IWT does not apply to Treasury Notes. For further information see Tax Ruling No IT 2054.

The information memoranda for Treasury Bonds and Treasury Indexed Bonds will be updated in coming weeks to reflect the change in relation to IWT.

Last updated: 21 March 2014