INCOME TAX ASSESSMENT ACT 1997 (ARCHIVE)

CHAPTER 4 - INTERNATIONAL ASPECTS OF INCOME TAX  

PART 4-5 - GENERAL  

Division 820 - Thin capitalisation rules  

Subdivision 820-F - Thin capitalisation rules for resident TC groups  

How this Division applies to a resident TC group

SECTION 820-555 (ARCHIVE)   Rest of Division not to apply to group headed by foreign-controlled Australian ADI or its holding company  

820-555(1)    
This Division (except this Subdivision) does not apply to any entity that is in a *resident TC group for an income year, if the group:

(a) is not an *outward investing entity (ADI) for the income year; and

(b) consists solely of 2 or more entities, each of which is, at the end of the income year:

(i) an entity that is both a *foreign controlled Australian entity and an *ADI; or

(ii) a 100% subsidiary of an entity in the group that is covered by subparagraph (i); or

(iii) a partnership, all interests in whose income and capital are beneficially owned by one or more entities in the group, each of which is covered by subparagraph (i) or (ii); or

(iv) a trust, all interests in whose income and capital are beneficially owned at the end of the income year by one or more entities in the group, each of which is covered by subparagraph (i), (ii) or (iii); or

(v) a company that meets the condition in subsection (2).

820-555(2)    
To be covered by subparagraph (1)(b)(v), a company:

(a) must be a *foreign controlled Australian company at the end of the income year; and

(b) must beneficially own at the end of the income year all the *shares in an entity in the group that is covered by subparagraph (1)(b)(i); and

(c) must have no other assets at the end of the income year; and

(d) must have no *debt capital at any time during the income year.