INCOME TAX ASSESSMENT ACT 1936 (ARCHIVE)

PART IIIAA - FRANKING OF DIVIDENDS  

Division 1A - Circumstances in which a taxpayer can qualify for a franking credit, a franking rebate or the intercorporate dividend rebate  

Subdivision A - Preliminary  

SECTION 160APHG   SPECIAL PROVISIONS RELATING TO ACQUISITION OR DISPOSAL OF SHARES OR INTERESTS IN SHARES BY PARTNERS AND TRUST BENEFICIARIES  

160APHG(1)   Partnerships.  

If a partnership acquires, holds, or disposes of, shares or an interest in shares, each partner in the partnership is taken to acquire, hold, or dispose of, as the case may be, an interest in the shares.

160APHG(2)   Taxpayers becoming or ceasing to be partners.  

If the assets of a partnership include shares or an interest in shares:

(a) where a taxpayer becomes a partner in the partnership - the taxpayer is taken to acquire an interest in the shares; or

(b) where a taxpayer ceases to be a partner in the partnership - the taxpayer is taken to dispose of the taxpayer's interest in the shares.

160APHG(3)   Trusts that are not widely held trusts.  

If the trustee of a trust (other than a widely held trust) acquires, holds, or disposes of, shares or an interest in shares, each beneficiary of the trust (including, if the trust is a discretionary trust, a potential beneficiary) is taken to acquire, hold, or dispose of, as the case may be, an interest in the shares.

160APHG(4)   Taxpayers becoming or ceasing to be beneficiaries of trusts that are not widely held trusts.  

If a trust estate (other than the trust estate of a widely held trust) includes shares or an interest in shares:

(a) where a taxpayer becomes a beneficiary (including, if the trust is a discretionary trust, a potential beneficiary) of the trust - the taxpayer is taken to acquire an interest in the shares; or

(b) where a taxpayer ceases to be a beneficiary (including, if the trust is a discretionary trust, a potential beneficiary) of the trust - the taxpayer is taken to dispose of the taxpayer's interest in the shares.

160APHG(5)   Position of beneficiary of widely held trust if trustee makes the trustee's first acquisition of shares or interests.  

If:

(a) the trust estate of a widely held trust does not include shares or an interest in shares; and

(b) the trustee of the trust acquires shares or an interest in shares;

each beneficiary of the trust is taken to acquire an interest in the shares.

160APHG(6)   Position of beneficiary of widely held trust if trust estate includes shares or interests.  

If the trust estate of a widely held trust has included, or includes, shares or interests in shares, each person who is a beneficiary of the trust holds an interest in the shares while the person is such a beneficiary.

160APHG(7)   Disposal of shares or interests by trustee of widely held trust.  

If the trustee of a widely held trust disposes of some only of the shares or interests in shares that form part of the trust estate, no beneficiary of the trust is taken, because of the disposal, to dispose of that beneficiary's interest in the shares but, if the trustee disposes of all the shares and interests, each beneficiary is taken to dispose of the beneficiary's interest in the shares.

160APHG(8)   Taxpayers becoming or ceasing to be beneficiaries of widely held trust.  

If the trust estate of a widely held trust has included or includes shares or an interest in shares:

(a) a taxpayer who becomes a beneficiary of the trust is taken to acquire an interest in the shares at the time when the taxpayer becomes the beneficiary, whether or not the trust estate includes the shares or interest in the shares at that time; and

(b) a taxpayer who is a beneficiary of the trust and acquires a further interest in the trust (whether by subscription for, or purchase of, further units or otherwise) is taken to acquire a further interest in the shares at the time when the taxpayer acquires the further interest in the trust, whether or not the trust estate includes the shares or interest in the shares at that time; and

(c) a taxpayer who disposes of an interest in the trust (whether by redemption or sale of units or otherwise) but remains a beneficiary of the trust is taken to dispose of an interest in the shares at the time when the taxpayer disposes of the interest in the trust, whether or not the trust estate includes the shares or interest in the shares at that time; and;

(d) a taxpayer who ceases to be a beneficiary of a trust is taken to dispose of the interest in shares that the taxpayer held as a beneficiary of the trust at the time when the taxpayer ceases to be a beneficiary of the trust, whether or not the trust estate includes the shares or interest in the shares at that time.

Note 1:

The interest that a partner in a partnership has in shares which, or an interest in which, is included in the assets of the partnership is worked out under section 160APHK .

Note 2:

The interest that a beneficiary of a trust has in shares which, or an interest in which, is held by the trustee of the trust is worked out under section 160APHL .