Income Tax Assessment Act 1936

PART X - ATTRIBUTION OF INCOME IN RESPECT OF CONTROLLED FOREIGN COMPANIES  

Division 7 - Calculation of attributable income of CFC  

Subdivision B - General modifications of Australian tax law  

SECTION 398A   APPLICATION OF DIVISION 3A OF PART III  

398A(1)   [Application of Div 3A of Pt III]  

Subject to subsection (2), Division 3A of Part III applies in calculating the attributable income of the eligible CFC.

398A(2)   [Section 82R does not apply]  

Section 82R does not apply, subject to subsection (3), to outgoings during the eligible period under a convertible note if:

(a) the note was issued by the eligible CFC (whether or not the company concerned was a CFC at the time):

(i) before 1 July 1990; or

(ii) on or after 1 July 1990 and before 1 July 1992, where:

(A) the terms of the issue of the note were publicly announced by the eligible CFC before 1 July 1990; or

(B) the eligible CFC was, under a contract entered into before 1 July 1990, obliged to issue the note; and

(b) at the end of each statutory accounting period of the eligible CFC preceding the eligible period and ending after 30 June 1990, the eligible taxpayer was an attributable taxpayer in relation to the eligible CFC; and

(c) the eligible period begins before 1 July 2000.

398A(3)   [Outgoings not covered]  

If:

(a) the terms of a note to which subsection (2) would, apart from this subsection, apply are varied (otherwise than because of a compromise or arrangement approved by a court); and

(b) the Commissioner considers that the variation is substantial enough to represent a new loan;

subsection (2) does not apply to outgoings under the note after the time at which the variation takes place.