Income Tax Assessment Act 1936

PART III - LIABILITY TO TAXATION

Division 7A - Distributions to entities connected with a private company

View history reference

View history note

Subdivision DB - Other exceptions

View history reference

View history note

SECTION 109RB COMMISSIONER MAY DISREGARD OPERATION OF DIVISION OR ALLOW DIVIDEND TO BE FRANKED

View history reference

109RB(1) [ Honest mistake, etc]

The Commissioner may make a decision under subsection (2) if:

(a) this Division (disregarding this section) operates with the result that:

(i) a private company is taken to pay a particular dividend to a particular entity (the recipient ) under this Division; or

(ii) a particular amount is included, as if it were a dividend, in the assessable income of a particular entity (also the recipient ) in relation to a private company under Subdivision EA ; and

(b) the result mentioned in paragraph (a) arises because of an honest mistake or inadvertent omission by any of the following entities:

(i) the recipient;

(ii) the private company;

(iii) any other entity whose conduct contributed to that result.

109RB(2) [ Commisioner's discretion]

The Commissioner may decide in writing that:

(a) the result mentioned in paragraph (1)(a) should be disregarded (see subsection (4)); or

(b) the dividend mentioned in subparagraph (1)(a)(i) may be franked in accordance with Part 3-6 of the Income Tax Assessment Act 1997 (see subsection (6)).

109RB(3) [ Relevant contributing factors]

In making a decision under subsection (2) (or refusing to make such a decision), the Commissioner must have regard to the following:

(a) the circumstances that led to the mistake or omission mentioned in paragraph (1)(b);

(b) the extent to which any of the entities mentioned in paragraph (1)(b) have taken action to try to correct the mistake or omission and if so, how quickly that action was taken;

(c) whether this Division has operated previously in relation to any of the entities mentioned in paragraph (1)(b), and if so, the circumstances in which this occurred;

(d) any other matters that the Commissioner considers relevant.

109RB(4) [ Further conditions]

The Commissioner may make a decision under subsection (2) subject to any of the following kinds of condition:

(a) a condition that the recipient or another entity must make specified payments to the private company or another entity within a specified time;

(b) a condition that a specified requirement in this Division must be met within a specified time.

109RB(5) [ Effect of decision]

This Division is taken not to operate with the result mentioned in paragraph (1)(a) if:

(a) the Commissioner makes a decision under paragraph (2)(a); and

(b) if the Commissioner makes the decision subject to a condition under subsection (4) - the condition is satisfied.

109RB(6) [ Dividend not made unfrankable]

If the Commissioner makes a decision under paragraph (2)(b), subparagraph 202-45(g)(i) of the Income Tax Assessment Act 1997 does not make the dividend mentioned in subparagraph (1)(a)(i) unfrankable.

109RB(7) [ Restriction]

Despite subsection 33(3A) of the Acts Interpretation Act 1901 , each decision made under subsection (2) must relate only to one amount that would (disregarding this section):

(a) be taken to be a dividend paid by the private company; or

(b) be included, as if it were a dividend, in the assessable income of an entity.

View history note

History

S 109RB inserted by No 79 of 2007 , s 3 and Sch 1 item 13, effective 21 June 2007. No 79 of 2007 , s 3 and Sch 1 item 43 contains the following application provision:

(4)
Despite subitem (1), the following rules apply:

(a) the amendments, to the extent that they relate to section 109RB of the Income Tax Assessment Act 1936 , apply in relation to the 2001-02 income year and later income years;

(b) the Commissioner may make decisions under that section on and after the commencement of that section in relation to events that occurred before that commencement;

(c) however, the Commissioner cannot make a decision under paragraph 109RB(2)(b) of that Act if the dividend mentioned in subparagraph 109RB(1)(a)(i) of that Act is taken to have been paid before 1 July 2002;

(d) the Commissioner may amend a franking assessment made before the commencement of this item for the purpose of giving effect to a decision under section 109RB of that Act, if the amendment is made within 4 years after that commencement.

(5)
Section 170 of the Income Tax Assessment Act 1936 does not prevent the amendment of an assessment if:

(a) the assessment was made before the commencement of this item; and

(b) the amendment is made within 4 years after that commencement; and

(c) the amendment is made for the purpose of giving effect to a decision of the Commissioner under section 109RB of that Act.

Disclaimer and notice of copyright applicable to materials provided by CCH Australia Limited

CCH Australia Limited ("CCH") believes that all information which it has provided in this site is accurate and reliable, but gives no warranty of accuracy or reliability of such information to the reader or any third party. The information provided by CCH is not legal or professional advice. To the extent permitted by law, no responsibility for damages or loss arising in any way out of or in connection with or incidental to any errors or omissions in any information provided is accepted by CCH or by persons involved in the preparation and provision of the information, whether arising from negligence or otherwise, from the use of or results obtained from information supplied by CCH.

The information provided by CCH includes history notes and other value-added features which are subject to CCH copyright. No CCH material may be copied, reproduced, republished, uploaded, posted, transmitted, or distributed in any way, except that you may download one copy for your personal use only, provided you keep intact all copyright and other proprietary notices. In particular, the reproduction of any part of the information for sale or incorporation in any product intended for sale is prohibited without CCH's prior consent.