This Subdivision sets out rules about payments and loans that are not treated as dividends.

The following sorts of payments are not treated as dividends:

• payments of genuine debts (section 109J );

• payments to other companies (section 109K );

• payments that are otherwise assessable or that are specifically excluded from assessable income (section 109L ).

The following sorts of loans are not treated as dividends:

• loans to other companies (section 109K );

• loans that are otherwise assessable (section 109L );

• loans made in the ordinary course of business on ordinary commercial terms (section 109M );

• loans that meet criteria for minimum interest rate and maximum term (section 109N );

• certain loans and distributions by liquidators (section 109NA );

• loans that are for the purpose of funding the purchase of certain ESS interests under an employee share scheme (section 109NB ).

An amalgamated loan may not be treated as a dividend if the Commissioner is satisfied that doing so would cause undue hardship. (See section 109Q .)

This Subdivision also provides for some loan repayments and interest payments to private companies to be disregarded if they are made with the intention of borrowing a similar amount from a private company later. (See section 109R .)