Taxation Determination

TD 2004/4A1 - Addendum

Income tax: Is a dividend paid before 1 July 1987 an unfranked dividend for the purpose of section 705-50 of the Income Tax Assessment Act 1997?

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Addendum

This Addendum amends Taxation Determination TD 2004/4 to reflect the effect of the amendment to section 705-50 of the Income Tax Assessment Act 1997 (ITAA 1997) and the subsequent repeal of that section by Schedule 5 to the Tax Laws Amendment (2010 Measures No. 1) Act 2010.

TD 2004/4 is amended as follows:

1. Title

Omit 'Is'; substitute 'is'.

2. After paragraph 9

Insert:

10. Tax Laws Amendment (2010 Measures No. 1) Act 2010 has amended paragraph 705-50(2)(b) of the ITAA 1997 so that where an entity becomes a subsidiary member of a consolidated group or a Multiple Entity Consolidated (MEC) group during the period from 9 May 2007 to 30 June 2009, the joining entity will only be required to look at dividends paid during the period of 5 years ending at the joining time in determining whether an over-depreciation adjustment is required under section 705-50 of the ITAA 1997. This means dividends paid before 1 July 1987 will no longer need to be considered in making this determination. In addition, section 705-50 of the ITAA 1997 is repealed effective from 1 July 2009.

11. Consequently, this Determination will not have application to an entity that joins a consolidated group or a MEC group on or after 9 May 2007.

3. Legislative References

Insert:

Tax Laws Amendment (2010 Measures No. 1) Act 2010

This Addendum applies on and from 9 May 2007.

Commissioner of Taxation
23 March 2011

References

ATO references:
NO 1-2EJ76VS