Taxation Laws Amendment Act (No. 4) 2002 (53 of 2002)

Schedule 1   Thin capitalisation

Part 1   Amendments

Income Tax Assessment Act 1997

36   At the end of section 820-920

Add:

(5) For the purposes of the method statement in subsection (4), this subsection covers a *debt interest at a particular time if the interest satisfies all of the following:

(a) the interest is *on issue at that time;

(b) neither the value of the interest, nor any part of that value, is all or a part of any *cost-free debt capital of the issuer of the interest at that time;

(c) the interest does not give rise to any cost, at any time, that is covered by paragraph 820-40(1)(a).

(6) For the purposes of the method statement in subsection (4), this subsection covers a *debt interest at a particular time if the interest satisfies both of the following:

(a) the interest is *on issue at that time;

(b) the interest gives rise to a cost, at any time, that is covered by paragraph 820-40(1)(a), but the cost is not deductible from the assessable income of the issuer of the interest for any income year.