Income Tax Assessment Act 1936

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

Division 8 - Active income test  

Subdivision B - Tainted income ratio  

SECTION 436   AMOUNTS EXCLUDED FROM ACTIVE INCOME TEST  

436(1)   [Excluded amounts]  

For the purposes of the application of this Part to a company, the following amounts are, in accordance with subparagraph 434(1)(a)(i) and paragraphs 434(1)(b), (c) and (d), excluded from the active income test:

(a) income or profits derived by the company that are included in the assessable income of the company of any year of income other than under section 143 (where the proviso to that section does not apply);

(b) income or profits derived by the company during a statutory accounting period where all of the following conditions are satisfied:

(i) the income or profits are derived by the company in carrying on a business at or through a permanent establishment of the company in a listed country (other than a listed country of which the company is a resident);

(ii) the income or profits are not eligible designated concession income in relation to any listed country in relation to the statutory accounting period;

(iii) the income or profits are subject to tax in a listed country in a tax accounting period:

(A) ending before the end of the statutory accounting period; or

(B) commencing during the statutory accounting period;

(c) an amount that, if the company were a resident within the meaning of section 6 , would, or would apart from paragraphs 99B(2)(d) and (e), have been included in the assessable income of the company under Division 6 of Part III ;

(d) so much of a frankable distribution as is either the franked part of the distribution, or the part of the distribution that has been franked with an exempting credit;

(e) a non-portfolio dividend paid to the company by a company that is a resident of a listed country or unlisted country;

(f) (Repealed by No 96 of 2004)

(g) a premium paid or credited to the company where, because of the application of subsection 148(1) , the premium is not allowable as a deduction to the person referred to in subparagraph 148(1)(a)(i) and is not included in the assessable income of the company.

436(2)   [Exclusion of attribution account payment]  

Where:

(a) the company receives an attribution account payment, being a dividend, from another entity; and

(b) the whole or part (in this subsection called the eligible amount ) of the attribution account payment is not excluded from the active income test, in relation to the company in relation to the statutory accounting period, under subsection (1); and

(c) on the making of the attribution account payment by the other entity, an attribution debit arises for that entity in relation to a taxpayer;

then, for the purposes of this Part, so much of the eligible amount as does not exceed the grossed-up amount of the attribution debit is, in accordance with subparagraph 434(1)(a)(i) ,excluded (in addition to any other amount that is excluded under subsection (1)) from the active income test in relation to the company in relation to the taxpayer.