Tax Laws Amendment (2007 Measures No. 5) Act 2007 (164 of 2007)

Schedule 3   Thin capitalisation: groups containing certain ADIs

Income Tax Assessment Act 1997

5   After section 820-609

Insert:

820-610 Choice not to be outward investing entity (ADI) or inward investing entity (ADI)

(1) This section applies if:

(a) apart from this section, the *head company or single company would, under section 820-609, be an *outward investing entity (ADI) or an *inward investing entity (ADI) for the trial period; and

(b) at all times in the trial period, each of the following entities that is an *ADI is a *specialist credit card institution:

(i) the head company or single company;

(ii) an establishment entity whose *Australian permanent establishments the head company or single company has chosen under section 820-597 or 820-599 to have treated as part of the company for the period.

(2) The *head company or single company is an outward investing entity (non-ADI) and an outward investor (financial) for the trial period if:

(a) apart from this section, the company would, under section 820-609, be an *outward investing entity (ADI) for the trial period; and

(b) the company chooses, before lodging its *income tax return for the income year including the trial period, to be an outward investing entity (non-ADI) and an outward investor (financial) for that period.

(3) The *head company or single company is an inward investing entity (non-ADI) and an inward investment vehicle (financial) for the trial period if:

(a) apart from this section, the company would, under section 820-609, be an *inward investing entity (ADI) for the trial period; and

(b) the company chooses, before lodging its *income tax return for the income year including the trial period, to be an inward investing entity (non-ADI) and an inward investment vehicle (financial) for that period.

(4) This section has effect despite sections 820-85, 820-185 and 820-609.