Income Tax Assessment Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-6 - THE IMPUTATION SYSTEM  

Division 208 - Exempting entities and former exempting entities  

Subdivision 208-F - Exempting accounts and franking accounts of exempting entities and former exempting entities  

Operative provisions

SECTION 208-120   Exempting debits  

208-120(1)    
The following table sets out when a debit arises in the *exempting account of the *former exempting entity. A debit in the *former exempting entity ' s exempting account is called an exempting debit .

Exempting debits
Item	If:	A debit of:	Arises:
1	the entity had a *franking deficit at the time it became a *former exempting entity (at the time of its transition )	an amount equal to: (a) in a case not covered by paragraph (b) - the franking deficit; or (b) if the entity has been a former exempting entity at any time within a period of 12 months before its transition - so much of the franking deficit as would have been the entity ' s *exempting deficit had it remained a former exempting entity throughout the period	immediately after its transition
2	the entity makes a *distribution *franked with an exempting credit	an amount equal to the *exempting credit on the distribution	on the day on which the distribution is made
3	the entity *receives a refund of income tax; and the entity was an *exempting entity during all or part of the income year to which the refund relates; and the entity satisfies the *residency requirement for the income year to which the refund relates	an amount equal to that part of the refund that is attributable to the period during which the entity is an exempting entity	on the day on which the refund is received
4	the Commissioner makes a determination under paragraph 204-30(3)(b) giving rise to an *exempting debit for the entity (streaming distributions)	the amount specified in the determination	on the day specified in section 204-35
5	a *franking debit arises for the entity under section 204-15 (linked distributions), 204-25 (substituting tax-exempt bonus shares for franked distributions) or a determination made under paragraph 204-30(3)(a) (streaming distributions); and	an amount equal to that part of the franking debit that relates to the period during which the entity was an exempting entity	when the franking debit arises
	the entity was an *exempting entity for the whole or part of the period to which the franking debit relates
6	the Minister makes a determination under paragraph 208-185(4)(a) giving rise to an *exempting debit for the entity	the amount specified in the determination	on the day specified in the determination
7	the entity becomes an *exempting entity; and the entity has an *exempting surplus at the time it becomes an exempting entity	an amount equal to the exempting surplus	immediately after the entity becomes an exempting entity
8	the entity *receives a refund of diverted profits tax; and the entity was an *exempting entity during all or part of the income year to which the refund relates; and the entity satisfies the *residency requirement for the income year to which the refund relates	an amount equal to that part of the refund that is attributable to the period during which the entity is an exempting entity, multiplied by the proportion worked out under subsection (2)	on the day on which the refund is received

208-120(2)    

The proportion is the standard corporate tax rate (within the meaning of Part IVA of the Income Tax Assessment Act 1936) divided by 40%.