Income Tax Assessment Act 1997

Head company may make FDA declaration  
717-520(1)
This section operates if:

(a) on a day, a company that is a ^* subsidiary member of a ^* consolidated group pays dividends (within the meaning of Subdivision B of Division 11A of Part III of the Income Tax Assessment Act 1936 ) to shareholders (within the meaning of that Act) in respect of ^* shares in the company; and

(b) on the day, there is an ^* FDA surplus for the ^* head company of the consolidated group.

717-520(2)
The ^* head company may make an ^* FDA declaration specifying an ^* FDA declaration percentage under subsection 128TC(1) of the Income Tax Assessment Act 1936 as if the head company were paying the dividends.

Note:

If the head company makes an FDA declaration:

(a) an FDA debit equal to the sum of the FDA declaration amounts worked out for the dividends by reference to the FDA declaration percentage will arise for the head company just after the start of the day under section 128TB of the Income Tax Assessment Act 1936 ; and

(b) foreign resident shareholders in the subsidiary member will be relieved from withholding tax on amounts of the dividends not exceeding the FDA declaration amounts.

717-520(3)
In this Act:

FDA declaration percentage
has the same meaning as in Subdivision B of Division 11A of Part III of the Income Tax Assessment Act 1936 .

717-520(4)
However, subsection 128TC(2) of the Income Tax Assessment Act 1936 operates in relation to the ^* FDA declaration percentage on the basis that:

(a) the company mentioned in that subsection is the ^* subsidiary member; and

(b) the dividends were paid to shareholders in respect of ^* shares in the subsidiary member.

717-520(5)
To avoid doubt, subsection 128TC(5) of the Income Tax Assessment Act 1936 operates in relation to the ^* head company ' s ^* FDA declaration by reference to amounts worked out on the basis described in subsection (4) of this section.

717-520(6)
To avoid doubt, sections 128TD and 128TE of the Income Tax Assessment Act 1936 apply to the ^* head company in relation to an ^* FDA declaration made because of subsection (2) of this section, even though the shareholders and dividends mentioned in those sections applying in relation to the declaration are shareholders in, and dividends paid by, the ^* subsidiary member.