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

Schedule 7   Distributions to beneficiaries and partners that are equivalent to interest

Income Tax Assessment Act 1936

12   After section 160ARAB

Insert:

160ARAC Adjustment where rebate not allowed in respect of trust amount or partnership amount

(1) If:

(a) a trust amount is included in a taxpayer's assessable income of a year of income; and

(b) the taxpayer is not entitled to a rebate of tax in respect of the trust amount because of subsection 160APQ(6), 160AQX(4), 160AQY(5), 160AQYA(1A) or 160AQZA(6); and

(c) no deduction has been allowed, or is allowable, from the trustee's assessable income of any year of income under section 160AR or 160ARAB;

an amount equal to the class A potential rebate amount, the class B potential rebate amount, or the class C potential rebate amount, that arises in relation to the trust amount is allowable as a deduction from the trustee's assessable income of the year of income.

(2) If:

(a) a partnership amount is included in a taxpayer's assessable income of a year of income; and

(b) the taxpayer is not entitled to a rebate of tax in respect of the partnership amount because of subsection 160APQ(6), 160AQYA(5), 160AQZ(4) or 160AQZA(6); and

(c) no deduction has been allowed, or is allowable, from the partnership's assessable income of any year of income under section 160AR or 160ARAB;

an amount equal to the class A potential rebate amount, the class B potential rebate amount, or the class C potential rebate amount, that arises in relation to the partnership amount is allowable as a deduction from the partnership's assessable income of the year of income.