Taxation Laws Amendment Act (No. 2) 1999 (93 of 1999)

Schedule 1   Australia as a regional financial centre

Part 1   OBUs, withholding tax and thin capitalisation

Income Tax Assessment Act 1936

21   At the end of section 121EL

Add:

(2) If:

(a) an OBU is a trustee, or is the central manager and controller, of a trust estate; and

(b) the only person who benefits, or is capable (whether by the exercise of a power of appointment or otherwise) of benefiting, under the trust is an overseas charitable institution; and

(c) the terms of the trust are to the effect that income, profits or capital gains of the trust estate may only come from investment activities covered by subsection 121D(6B);

then:

(d) any income of the trust estate derived from an investment activity covered by subsection 121D(6B) is exempt from income tax; and

(e) any capital gain or capital loss made by the trust estate from a CGT event happening in relation to a CGT asset of the trust estate in the course of, or in connection with, an investment activity covered by subsection 121D(6B) is disregarded.