Income Tax Assessment Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-5 - CORPORATE TAXPAYERS AND CORPORATE DISTRIBUTIONS  

Division 180 - Information about family trusts with interests in companies  

Subdivision 180-A - Information relevant to Division 165  

SECTION 180-5   Information about family trusts with interests in companies  

Notice about company

180-5(1)    
The Commissioner may give a company a notice in accordance with section 180-10 if the requirements of this section are met.

Tax detriment under Division 165

180-5(2)    

In its *income tax return for an income year:

(a) the company must have deducted a *tax loss from a *loss year where it would not be allowed to deduct the tax loss if it did not meet the conditions in section 165-12 ; or

(b) the company must not have calculated:

(i) its taxable income and tax loss under Subdivision 165-B ; and

(ii) its *net capital gain and *net capital loss under Subdivision 165-CB ;

where it would have been required to calculate them under that Subdivision if it did not satisfy the requirements of paragraph 165-35(a) ; or

(c) the company must have applied a *net capital loss from an earlier income year in working out its net capital gain where it would not have been allowed to apply the loss if it did not meet the condition in section 165-12 as applied on the assumption mentioned in subsection 165-96(1) ; or

(d) the company must have deducted a debt that it wrote off as bad in the income year where it would not be allowed to deduct the debt if it did not satisfy the requirements of paragraph 165-120(1)(a) or (b).

Role of family trust

180-5(3)    
The Commissioner must be satisfied that the company:

(a) if paragraph (2)(a) applies - meets the conditions in section 165-12 ; or

(b) if paragraph (2)(b) applies - satisfies the requirements of paragraph 165-35(a) ; or

(c) if paragraph (2)(c) applies - meets the conditions in section 165-12 as applied on the assumption mentioned in subsection 165-96(1) ; or

(d) if paragraph (2)(d) applies - satisfies the requirements of paragraph 165-120(1)(a) or (b);

but it would not do so unless one or more trusts were *family trusts.

Foreign resident trust

180-5(4)    
When the Commissioner gives the notice, for at least one of the *family trusts:

(a) a trustee of the trust must be a foreign resident; or

(b) the central management and control of the trust must be outside Australia.

When notice must be given

180-5(5)    
The Commissioner must give the notice before the later of:

(a) 5 years after the income year to which the return relates; and

(b) the end of the period during which the company is required by section 262A of the Income Tax Assessment Act 1936 to retain records in relation to that income year.