Income Tax Assessment Act 1997

Pt 3-6 inserted by No 48 of 2002.

Div 220 inserted by No 67 of 2003.

Subdiv 220-C inserted by No 67 of 2003.

S 220-405(1) amended by No 143 of 2007 , s 3 and Sch 1 item 152, by substituting " to a tax offset under Division 770 " for " under section 160AF (Credits in respect of foreign tax) of the Income Tax Assessment Act 1936 to a credit " in para (d), applicable in relation to income years, statutory accounting periods and notional accounting periods starting on or after the first 1 July that occurs after 24 September 2007. For savings provisions, see note under Div 770 heading .

S 220-405(1) amended by No 83 of 2004, s 3 and Sch 10 items 37 to 39, by substituting " section 207-45 " for " section 207-50 " in para (c), omitting " and " from the end of para (d) and repealing para (e), applicable in relation to things happening on or after 1 April 2003, subject to the rules on the application of Part 3-6 of the Income Tax Assessment Act 1997 set out in the Income Tax (Transitional Provisions) Act 1997 . Para (e) formerly read:

(e) the recipient ' s income tax for the income year is reduced to some extent on account of the credit.

S 220-405(2) to (9) substituted for s 220-405(2) to (8) by No 83 of 2004, s 3 and Sch 10 item 40, applicable in relation to things happening on or after 1 April 2003, subject to the rules on the application of Part 3-6 of the Income Tax Assessment Act 1997 set out in the Income Tax (Transitional Provisions) Act 1997 . S 220-405(2) formerly read:

220-405(2)
The supplementary dividend flows indirectly to an entity if, had the supplementary dividend been a *franked distribution, it would have *flowed indirectly to the entity under section 207-35.

S 220-405(2) to (9) substituted for s 220-405(2) to (8) by No 83 of 2004, s 3 and Sch 10 item 40, applicable in relation to things happening on or after 1 April 2003, subject to the rules on the application of Part 3-6 of the Income Tax Assessment Act 1997 set out in the Income Tax (Transitional Provisions) Act 1997 . S 220-405(3) formerly read:

Deduction for recipient

220-405(3)
The recipient can deduct for the income year the amount worked out using the formula:

Amount of the supplementary dividend

×

Recipient ' s share of the *net income of the partnership or trust *Net income of the partnership or trust

S 220-405(2) to (9) substituted for s 220-405(2) to (8) by No 83 of 2004, s 3 and Sch 10 item 40, applicable in relation to things happening on or after 1 April 2003, subject to the rules on the application of Part 3-6 of the Income Tax Assessment Act 1997 set out in the Income Tax (Transitional Provisions) Act 1997 . S 220-405(4) formerly read:

Amount of recipient ' s tax offset

220-405(4)
Work out the amount of the recipient ' s *tax offset using the formula:

However, the amount of the tax offset is nil if the amount of the supplementary dividend is greater than the amount of the franking credit on the franked distribution.

S 220-405(2) to (9) substituted for s 220-405(2) to (8) by No 83 of 2004, s 3 and Sch 10 item 40, applicable in relation to things happening on or after 1 April 2003, subject to the rules on the application of Part 3-6 of the Income Tax Assessment Act 1997 set out in the Income Tax (Transitional Provisions) Act 1997 . S 220-405(5) formerly read:

Reduction of amount on which trustee recipient is assessed

220-405(5)
If the recipient:

(a) is the trustee of a trust; and

(b) is liable under section 98, 99 or 99A of the Income Tax Assessment Act 1936 to be assessed on a share of the *net income, the net income or a part of the net income, of the trust;

the amount on which the recipient is liable to be assessed is reduced by the amount worked out using the formula:

Amount of the supplementary dividend

×

Amount on which the recipient would be assessed apart from         this section         *Net income of the trust

S 220-405(2) to (9) substituted for s 220-405(2) to (8) by No 83 of 2004, s 3 and Sch 10 item 40, applicable in relation to things happening on or after 1 April 2003, subject to the rules on the application of Part 3-6 of the Income Tax Assessment Act 1997 set out in the Income Tax (Transitional Provisions) Act 1997 . S 220-405(6) formerly read:

Tax offset if recipient is trustee who is assessed

220-405(6)
Despite subsection (4), work out the amount of the recipient ' s *tax offset using the formula if the recipient:

(a) is the trustee of a trust; and

(b) is liable under section 98, 99 or 99A of the Income Tax Assessment Act 1936 to be assessed on a share of the *net income, the net income or a part of the net income, of the trust;

However, the amount of the tax offset is nil if the amount of the supplementary dividend is greater than the amount of the franking credit on the franked distribution.

S 220-405(2) to (9) substituted for s 220-405(2) to (8) by No 83 of 2004, s 3 and Sch 10 item 40, applicable in relation to things happening on or after 1 April 2003, subject to the rules on the application of Part 3-6 of the Income Tax Assessment Act 1997 set out in the Income Tax (Transitional Provisions) Act 1997 . S 220-405(7) formerly read:

Amount of tax offset in case of manipulation

220-405(7)
If paragraph 207-150(2)(b) applies in relation to the recipient as the entity mentioned in that paragraph, it has effect as if the amount of the entity ' s *share of the *franking credit on the distribution were equal to the amount of the *tax offset worked out for the recipient under this section.

Note:

Paragraph 207-150(2)(b) reduces the amount of a tax offset an entity is entitled to under section 207-50 for a franked distribution flowing indirectly to the entity if the Commissioner determines that no franking credit benefit is to arise for part of the distribution.

S 220-405(2) to (9) substituted for s 220-405(2) to (8) by No 83 of 2004, s 3 and Sch 10 item 40, applicable in relation to things happening on or after 1 April 2003, subject to the rules on the application of Part 3-6 of the Income Tax Assessment Act 1997 set out in the Income Tax (Transitional Provisions) Act 1997 . S 220-405(8) formerly read:

Relationship with Subdivisions 207-B and 207-F

220-405(8)
Subdivisions 207-B and 207-F have effect subject to this section.

Note:

Subdivision 207-B provides for an entitlement to a tax offset for a franked distribution flowing indirectly to an entity. Subdivision 207-F provides for reducing the amount of the offset if the Commissioner determines that no franking credit benefit is to arise for part of the distribution.

S 220-405(2) to (9) substituted for s 220-405(2) to (8) by No 83 of 2004, s 3 and Sch 10 item 40, applicable in relation to things happening on or after 1 April 2003, subject to the rules on the application of Part 3-6 of the Income Tax Assessment Act 1997 set out in the Income Tax (Transitional Provisions) Act 1997 .

S 220-405 inserted by No 67 of 2003.