INCOME TAX ASSESSMENT ACT 1936 (ARCHIVE)

PART IIIAA - FRANKING OF DIVIDENDS  

Division 12A - Venture capital franking  

Subdivision E - Venture capital franking declaration  

SECTION 160ASEL   PDF WITH A VENTURE CAPITAL SUB-ACCOUNT MAY DECLARE CLASS C FRANKED DIVIDEND TO BE A VENTURE CAPITAL FRANKED DIVIDEND  

160ASEL(1)   [When dividend may be franked]  

A PDF that has a venture capital sub-account may frank a dividend paid by the PDF as a venture capital franked dividend in accordance with this section if:

(a) the dividend is a class C franked dividend; and

(b) the dividend is paid under a resolution under which:

(i) dividends are to be paid to all shareholders in the PDF; and

(ii) the amount of the dividend per share is the same for each of those dividends.

160ASEL(2)   [When franking of dividend formula is used]  

The dividend is venture capital franked to the extent of the amount worked out using the formula in subsection (3) if:

(a) the PDF declares the dividend to be a venture capital franked dividend to a specified extent in the declaration that it makes under subsection 160AQF(1AAA) in relation to the dividend; and

(b) the extent to which the dividend is declared to be a venture capital franked dividend is the same for all dividends to be paid under the resolution.

Note 1:

Section 160ASEM requires the PDF to declare the dividend to be a venture capital franked dividend if the venture capital sub-account is in surplus when the subsection 160AQF(1AAA) declaration is made.

Note 2:

The PDF may anticipate future credits to the sub-account by making a declaration under this subsection even though the sub-account is in deficit or by making a declaration under this subsection that will put the sub-account into deficit.

Note 3:

If this subsection is not satisfied, the dividend is not a venture capital franked dividend.

160ASEL(3)   [Formula]  

Subject to subsection (4), the extent to which the dividend is venture capital franked is worked out using the formula:

Amount of dividend   ×

Percentage specified under     paragraph (2)(a)

160ASEL(4)   [Reduction by amount of excess]  

If the amount worked out under subsection (3) exceeds the class C franked amount of the dividend, the extent to which the dividend is venture capital franked is reduced by the amount of the excess.