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

Schedule 5   Franking of dividends by exempting companies and former exempting companies

Income Tax Assessment Act 1936

75   After subsection 221YL(3)

Insert:

(3AA) For the purpose of determining whether a deduction is required to be made under subsection (2) in relation to an exempted dividend paid to the trustee of a trust, or a partnership, in which a non-resident holds an interest within the meaning of section 160AQZB or 160AQZC, the dividend is taken to have been franked in accordance with section 160AQFA to the extent of the lesser of:

(a) so much of the dividend as the non-resident is entitled to receive or to have credited to the non-resident, or otherwise dealt with on behalf of the non-resident or as the non-resident directs, by the trustee or partnership; and

(b) the exempted amount of the dividend.