Income Tax Assessment Act 1997

CHAPTER 4 - INTERNATIONAL ASPECTS OF INCOME TAX  

PART 4-5 - GENERAL  

Division 820 - Thin capitalisation rules  

Subdivision 820-H - Control of entities  

Thin capitalisation control interest

SECTION 820-820   Special rules about calculating TC control interest held by an entity  

820-820(1)    
This section applies for the purposes of calculating the *TC control interest that an entity holds in a company, trust or partnership.

820-820(2)    
Disregard a *TC indirect control interest held by the entity to the extent to which it is calculated by reference to:

(a) a *TC direct control interest taken into account under paragraph 820-815(c) ; or

(b) a TC indirect control interest taken into account under paragraph 820-815(d) .

820-820(3)    

Disregard a *TC indirect control interest held by an *associate entity of the entity to the extent to which it is calculated by reference to:

(a) a *TC direct control interest taken into account under paragraph 820-815(a) or (c); or

(b) a TC indirect control interest taken into account under paragraph 820-815(b) or (d).

820-820(3A)    

Subsection (3) does not apply to an *associate entity of the entity if:

(a) the associate entity is a *foreign entity and the associate entity is such an associate entity only because of subsection 820-905(3A) ; or

(b) the associate entity is such an associate entity only because of subsection 820-905(3B) .

820-820(4)    
Take into account only one of the following things if both would otherwise be counted in calculating the *TC control interest:

(a) the holding of a *TC direct control interest by the entity or any other entity;

(b) an entitlement to acquire that TC direct control interest.

820-820(5)    
The operation of this section in relation to an entity does not prevent the operation of section 820-825 in relation to a group of entities that includes that entity.