Inward investing financial entity (non-ADI)
An entity is an inward investing financial entity (non-ADI) if it is an:
- inward investment vehicle (financial) – an Australian entity that is controlled by a foreign entity or foreign entities
- inward investor (financial) – a foreign entity. Although all foreign entities are inward investors, the thin capitalisation rules only affect foreign entities
- with an Australian permanent establishment or other Australian income producing assets
- that are claiming debt deductions.
However, an entity is not an inward investing financial entity (non-ADI) for a period that is all or part of an income year if it is a general class investor for that year.
For more information, see subsection 820-185(2) of the ITAA 1997.
Inward investing entity (ADI)
An entity will be an inward investing entity (ADI) for a period that is all or part of an income year if throughout that period the entity is a foreign bank which carries on its banking business in Australia at or through one or more Australian permanent establishments.
However, an entity is not an inward investing entity (ADI) for a period that is all or a part of an income year if it is a general class investor for that year.
For more information, see subsection 820-395(2) of the ITAA 1997.
Inward investment vehicle (financial)
This is an Australian entity that is foreign controlled. See foreign controlled Australian entity.
For more information, see subsection 820-185(2) of the ITAA 1997.
Inward investor (financial)
An inward investor is any foreign entity. Such entities are effectively only subject to the thin capitalisation rules if they have Australian income-producing assets. For more information, see subsection 820-185(2) of the ITAA 1997.