Taxation Laws Amendment Act (No. 4) 2002 (53 of 2002)

Schedule 1   Thin capitalisation

Part 1   Amendments

Income Tax Assessment Act 1997

35   Subsection 820-920(4) (steps 3 and 4 of the method statement)

Repeal the steps, substitute:

Step 3. Multiply the result of step 2 by the sum of:

(a) the value, as at that time, of all the *equity capital of the *associate entity that is attributable to the relevant entity at that time; and

(b) the value, as at that time, of all the *debt interests *issued by the associate entity that are covered by subsection (5), and held by the relevant entity, at that time; and

(c) the value, as at that time, of all the debt interests issued by the associate entity that are covered by subsection (6), and held by the relevant entity, at that time.

Step 4. Divide the result of step 3 by the sum of:

(a) the value, as at that time, of all the *equity capital of the *associate entity; and

(b) the value, as at that time, of all the *debt interests *issued by the associate entity that are covered by subsection (5) at that time; and

(c) the value, as at that time, of all the debt interests issued by the associate entity that are covered by subsection (6) at that time.


Copyright notice

© Australian Taxation Office for the Commonwealth of Australia

You are free to copy, adapt, modify, transmit and distribute material on this website as you wish (but not in any way that suggests the ATO or the Commonwealth endorses you or any of your services or products).