Tax Laws Amendment (2006 Measures No. 3) Act 2006 (80 of 2006)

Schedule 4   Simplified imputation system (share capital tainting rules)

Part 4   Relocating the definition of share capital account

Division 1   Main amendment

Income Tax Assessment Act 1997

20   After Subdivision 975-A

Insert:

Subdivision 975-G - What is a company's share capital account?

Table of sections

975-300 Meaning of share capital account

975-300 Meaning of share capital account

(1) A company's share capital account is:

(a) an account that the company keeps of its share capital; or

(b) any other account (whether or not called a share capital account) that satisfies the following conditions:

(i) the account was created on or after 1 July 1998;

(ii) the first amount credited to the account was an amount of share capital.

(2) If a company has more than one account covered by subsection (1), the accounts are taken, for the purposes of this Act, to be a single account.

Note: Because the accounts are taken to be a single account (the combined share capital account ), tainting of any of the accounts has the effect of tainting the combined share capital account.

(3) However, if a company's *share capital account is *tainted, that account is taken not to be a share capital account for the purposes this Act, other than:

(a) subsection 118-20(6); and

(b) Division 197; and

(c) the definition of paid-up share capital in subsection 6(1) of the Income Tax Assessment Act 1936; and

(d) subsection 44(1B) of the Income Tax Assessment Act 1936; and

(e) section 46H of the Income Tax Assessment Act 1936; and

(f) subsection 159GZZZQ(5) of the Income Tax Assessment Act 1936.