Tax Laws Amendment (2010 Measures No. 4) Act 2010 (136 of 2010)

Schedule 3   Taxation of financial arrangements

Part 1   Taxation of financial arrangements amendments

Income Tax Assessment Act 1997

6   After subsection 230-15(4)

Insert:

(4A) A *dividend on a *debt interest is a loss you can deduct to the extent to which it would have been a deductible loss under subsection (2) if:

(a) the payment of the amount of the dividend were the incurring of a liability to pay the same amount as interest; and

(b) that interest were incurred in respect of the finance raised by you and in respect of which the dividend was paid or provided; and

(c) the debt interest retained its character as a debt interest for the purposes of subsection (4).