Australia: Tax refunds will no longer be deposited into non-authorised deposit-taking institutions
Entities that are not an authorised deposit-taking institutions will no longer satisfy its “financial institution” requirements
Tax refunds will no longer be deposited into non-authorised deposit-taking institutions
The Australian Taxation Office (ATO) announced that entities that are not an authorised deposit-taking institutions (ADIs) will no longer satisfy its “financial institution” requirements for the purposes of a third-party refund from an income tax account.
According to the ATO, the term “financial institution” is defined under section 202A of the Income Tax Assessment Act 1936 to mean a bank or co-operative housing society.
The term “bank” in this case is then defined as a body corporate that is an ADI for the purpose of the Banking Act 1959.
The ATO explains that a non-ADI financial institution does not have a full banking license or is not supervised by a national regulatory authority and are generally privately funded and do not have the normal features of a deposit-taking institution.
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