Income Tax Assessment Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES

PART 3-5 - CORPORATE TAXPAYERS AND CORPORATE DISTRIBUTIONS

Division 167 - Companies whose shares carry unequal rights to dividends, capital distributions or voting power

History

Div 167 inserted by No 130 of 2015, s 3 and Sch 4 item 1, effective 17 September 2015. No 130 of 2015, s 3 and Sch 4 item 53 contains the following application provision:

167-1 Application of provisions
167-1(1)
Division 167 of the Income Tax Assessment Act 1997 applies:

(a) to any tax loss that is incurred in an income year commencing on or after 1 July 2002; and

(b) to any net capital loss that is made in an income year commencing on or after 1 July 2002; and

(c) to any deduction in respect of a bad debt that is claimed in an income year commencing on or after 1 July 2002; and

(d) in determining whether any changeover time or alteration time occurred on or after 1 July 2002.

167-1(2)
Division 167 of the Income Tax Assessment Act 1997 also applies:

(a) to any tax loss of a company:

(i) that is incurred in an income year commencing on or before 30 June 2002; and

(ii) that could have been deducted, in accordance with Divisions 165 and 166 of that Act as in force at that time, in the first income year commencing after 30 June 2002 if the deduction had not been limited by the company ' s income for that income year; and

(b) to any net capital loss of a company:

(i) that is made in an income year commencing on or before 30 June 2002; and

(ii) that could have been applied, in accordance with Divisions 165 and 166 of that Act as in force at that time, in the first income year commencing after 30 June 2002 if the application of the loss had not been limited by the company ' s capital gains for that income year.

Subdivision 167-A - Rights to dividends or capital distributions

View history reference

View history note

Guide to Subdivision 167-A

SECTION 167-7 Simplified outline of this Subdivision

View history reference

If a condition of the continuity of ownership test cannot be worked out for a company:

(a) because of its unequal share structure; or

(b) because of a holding company ' s unequal share structure;

an entity can choose to reconsider that condition in up to 3 ways.

The first way involves disregarding debt interests.

The second way involves disregarding debt interests and secondary share classes.

The third way involves disregarding those shares, and treating the remaining shares as carrying certain percentages of the rights to receive dividends and capital distributions.

The second way can only be tried after the first way, while the third way can only be tried after the second way.

View history note

TABLE OF SECTIONS

**TABLE OF SECTIONS**
Operative provisions
167-10	When this Subdivision applies
167-15	First way - disregard debt interests
167-20	Second way - also disregard secondary share classes
167-25	Third way - treat remaining shares as having fixed rights to dividends and capital distributions
167-30	Fixing rights if practicable to work out market values
167-35	Fixing rights if impracticable to work out market values etc.
167-40	The valuing times for conditions listed in subsection 167-10(1)

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