INCOME TAX ASSESSMENT ACT 1936 (ARCHIVE)

PART III - LIABILITY TO TAXATION  

Division 3 - Deductions  

Subdivision A - General  

SECTION 67AA   DEDUCTIONS FOR DEBT DIVIDENDS  

67AA(1)   [When dividend is debt dividend]  

For the purposes of this section, a dividend paid by a company is a debt dividend if the shareholder to whom the dividend is paid is not entitled to a rebate under section 46 or 46A in respect of the dividend but would be entitled to such a rebate but for subsection 46C(5) , but such a dividend shall not be taken to be a debt dividend to the extent to which it is paid in respect of finance obtained by an associate (within the meaning of section 46C ) of the company.

67AA(2)   [Deduction of debt dividend]  

A debt dividend paid by a company in a year of income is an allowable deduction to the company in respect of the year of income to the same extent as it would have been an allowable deduction under section 8-1 of the Income Tax Assessment Act 1997 if:

(a) the payment of the dividend had been the incurring by the company of a liability to pay the same amount as interest; and

(b) that interest had been incurred in respect of the finance that was obtained by the company and in respect of which the debt dividend was paid.

67AA(3)   [Application of s 45Z]  

Section 45Z applies for the purposes of this section in a corresponding way to the way in which it applies for the purposes of sections 46 , 46A and 46C .