Taxation Laws Amendment Act (No. 2) 1999 (93 of 1999)

Schedule 5   Franking of dividends by exempting companies and former exempting companies

Income Tax Assessment Act 1936

72   Subsection 177EA(20)

Repeal the subsection, substitute:

Meaning of greater benefit from franking credits

(20) The circumstances in which the relevant taxpayer would, in a year of income, derive a greater benefit from franking credits than another person referred to in paragraph (19)(b) include, but are not limited to:

(a) any of the following circumstances existing in relation to the other person and not in relation to the relevant taxpayer:

(i) the person is a non-resident;

(ii) the amount of tax (if any) that, apart from Part IIIAA, would be payable by the person is less than the amount of the rebate of tax to which the person would be entitled under section 160AQU, 160AQX, 160AQY, 160AQYA, 160AQZ or 160AQZA;

(iii) the person is a company that is unable to pay a dividend to its shareholders in the year of income because it has not made any profits or has not made sufficient profits to do so;

(iv) the person is an exempting company or a company for which no franking credits arise; and

(b) any of the following circumstances existing in relation to the relevant taxpayer and not in relation to the other person:

(i) a franking credit arises under section 160APPA;

(ii) a franking credit or exempting credit arises under section 160AQCNF;

(iii) subsection 160AQTA(2) or (5) applies;

(iv) section 160AQTB applies.