Repayment obligations of overseas-based borrowers

Sections 110(6)(b)(iii) and 111(5)(b)(iii)

An amendment has been made to clarify that an overseas-based repayment obligation for a year is based on a borrower's consolidated loan balance at the end of the previous tax year. The consolidated loan balance is limited to:

• the loan balance at that time;
• plus the annual administration fee; and
• reduced by the amount of the excess repayment bonus.

Previously it could be construed that for the purpose of determining a borrower's overseas-based repayment obligation, the excess repayment bonus is added to the borrower's loan balance instead of being subtracted from it as intended.

Application date

This amendment applies from 1 April 2012.