Income Tax Assessment Act 1997

CHAPTER 4 - INTERNATIONAL ASPECTS OF INCOME TAX  

PART 4-5 - GENERAL  

Division 768 - Foreign non-assessable income and gains  

Subdivision 768-G - Reduction in capital gains and losses arising from CGT events in relation to certain voting interests in active foreign companies  

Active foreign business asset percentage

SECTION 768-530   Active foreign business asset percentage - modifications for foreign life insurance companies and foreign general insurance companies  

768-530(1)    
If the foreign company is a ^* foreign life insurance company or a ^* foreign general insurance company, work out its ^* active foreign business asset percentage according to section 768-510 , but with the modifications set out in subsections (2) and (3).

768-530(2)    
Treat a reference in the following provisions to a period as a reference to a ^* statutory accounting period of the foreign company:

(a) paragraphs 768-510(3)(b) and (c);

(b) section 768-525 .

768-530(3)    
Apply the modifications set out in the following table.

Modifications for foreign life insurance companies and foreign general insurance companies
Item	The result of this step:	is increased by the amount applicable under subsection (4) for this statutory accounting period:
1	step 2 of the method statement in subsection 768-520(1)	the most recent *statutory accounting period of the foreign company ending at or before the time mentioned in that step
2	step 1 of the method statement in subsection 768-525(3)	the *statutory accounting period mentioned in that step (as modified by subsection (2) of this section)
3	step 2 of the method statement in subsection 768-525(3)	the *statutory accounting period mentioned in that step (as modified by subsection (2) of this section)

768-530(4)    
The amount applicable under this subsection for a ^* statutory accounting period of the foreign company is worked out using the following formula:

Value of non-active foreign business assets

×

Active insurance amount Total insurance assets

where:

active insurance amount
means:

(a) if the foreign company is a ^* foreign life insurance company - the untainted policy liabilities (within the meaning of subsection 446(2) of the Income Tax Assessment Act 1936 ) of the foreign company for the statutory accounting period; or

(b) if the foreign company is a ^* foreign general insurance company - the active general insurance amount worked out under subsection (5) for the statutory accounting period.

total insurance assets
means:

(a) if the foreign company is a ^* foreign life insurance company - the total assets (within the meaning of subsection 446(2) of the Income Tax Assessment Act 1936 ) of the foreign company for the statutory accounting period; or

(b) if the foreign company is a ^* foreign general insurance company - the total assets (within the meaning of subsection 446(4) of that Act) of the foreign company for the statutory accounting period.

value of non-active foreign business assets
means:

(a) for the purposes of item 1 of the table in subsection (3) - the difference between:

(i) the result of step 1 of the method statement in subsection 768-520(1) ; and

(ii) the result of step 2 of that method statement (apart from this section); or

(b) for the purposes of item 2 of the table in subsection (3) - the difference between:

(i) the result of step 1 of the method statement in subsection 768-525(2) ; and

(ii) the result of step 1 of the method statement in subsection 768-525(3) (apart from this section); or

(c) for the purposes of item 3 of the table in subsection (3) - the difference between:

(i) the result of step 2 of the method statement in subsection 768-525(2) ; and

(ii) the result of step 2 of the method statement in subsection 768-525(3) (apart from this section).

Active insurance amount for foreign general insurance company

768-530(5)    
The active general insurance amount under this subsection for a *statutory accounting period of the foreign company is worked out using the following formula:

Total general insurance assets

−

Net assets

−

Tainted outstanding claims

+

Solvency amount

where:

net assets
means the net assets (within the meaning of subsection 446(4) of the Income Tax Assessment Act 1936 ) of the foreign company for the statutory accounting period.

solvency amount
means the solvency amount (within the meaning of subsection 446(4) of the Income Tax Assessment Act 1936 ) of the foreign company for the statutory accounting period.

tainted outstanding claims
means the tainted outstanding claims (within the meaning of subsection 446(4) of the Income Tax Assessment Act 1936 ) of the foreign company for the statutory accounting period.

total general insurance assets
means the total assets (within the meaning of subsection 446(4) of the Income Tax Assessment Act 1936 ) of the foreign company for the statutory accounting period.