Income Tax Assessment Act 1997

CHAPTER 4 - INTERNATIONAL ASPECTS OF INCOME TAX  

PART 4-5 - GENERAL  

Division 802 - Foreign residents ' income with an underlying foreign source  

Subdivision 802-A - Conduit foreign income  

Operative provisions

SECTION 802-30   Foreign source income amounts  

802-30(1)    
Work out the amount of the entity ' s *ordinary income and *statutory income derived by the entity that has been, is or will be included in an income statement or similar statement of the entity or of another entity and that would not be included in the entity ' s assessable income if the entity:

(a) for a company or a *corporate limited partnership - were a foreign resident at the relevant time; or

(b) for a *public trading trust - were not a *resident unit trust for the income year in which the relevant time occurs.

Note:

Income statements are prepared under the Framework for the Preparation and Presentation of Financial Statements (which is referred to in the Australian Accounting Standards).

802-30(2)    
Reduce the subsection (1) amount by any part of that amount that is or will be included in the entity ' s assessable income (apart from section 802-20 ).

802-30(3)    
Add to the amount remaining after subsection (2) these amounts:

(a) if the entity receives from another *Australian corporate tax entity a *frankable distribution that has an *unfranked part - any amount declared in the *distribution statement for that *distribution to be *conduit foreign income;

(b) an amount that is treated as a received CFI amount for the purposes of section 802-20 because of subsection 802-20(5) ;

(c) an amount that is *non-assessable non-exempt income under section 768-5 and that would not be included under subsection (1).

802-30(4)    
Reduce the amount remaining after subsection (3) by these amounts:

(a) an amount that is *non-assessable non-exempt income under section 23AI or 23AK of the Income Tax Assessment Act 1936 ;

(b) an amount that is not included in the entity ' s assessable income because of the operation of paragraph 99B(2)(e) of that Act;

(c) the amount worked out using the formula:

Available franking credit

×

(1 − *Corporate tax rate)       *Corporate tax rate

where:

available franking credit
means any part of the amount remaining after subsection (3) to the extent to which a *franking credit arises or will arise for the entity.

802-30(5)    
Reduce the amount remaining after subsection (4) by any of the entity ' s expenses that are reasonably related to that amount, except expenses the entity has deducted or can deduct under this Act. In applying this subsection to an amount covered by paragraph (3)(a), assume that amount is *non-assessable non-exempt income.

802-30(6)    
The result is an amount included in the entity ' s conduit foreign income .

802-30(7)    
This section applies to an entity as if it had derived an amount if the amount has been applied for its benefit (including by discharging all or part of a debt it owes) or as it directs.