INCOME TAX ASSESSMENT ACT 1936 (ARCHIVE)

PART IIIAA - FRANKING OF DIVIDENDS  

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Division 12A - Venture capital franking  

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Subdivision B - Ascertaining whether there is a surplus or deficit in the venture capital sub-account  

SECTION 160ASEC   ASCERTAINMENT OF SURPLUS OR DEFICIT  

160ASEC(1)   [Calculation or surplus]  

The surplus in a PDF's venture capital sub-account at a particular time in a franking year is the excess calculated using the formula:


Venture capital credits
at that time      		 − Venture capital debits
      at that time

where:

venture capital credits at that time
has the meaning given by subsection (4).

venture capital debits at that time
has the meaning given by subsection (4).

160ASEC(2)   [Calculation of deficit]  

The deficit in a PDF's venture capital sub-account at a particular time in a franking year is the excess calculated using the formula:


Venture capital credits
at that time      		 − Venture capital debits
      at that time

where:

venture capital credits at that time
has the meaning given by subsection (4).

venture capital debits at that time
has the meaning given by subsection (4).

160ASEC(3)   [Sub-accounts]  

The venture capital sub-account may be in deficit even though the class C franking account as a whole is in surplus. Similarly, the venture capital sub-account may be in surplus even though the class C franking account as a whole is in deficit.

Note:

This can happen because:

  • (a) only amounts coming from particular sources can be credited or debited to the venture capital sub-account; and
  • (b) the PDF may anticipate future venture capital credits to a greater or lesser extent than it anticipates future class C franking credits generally; and
  • (c) the venture capital credits and debits do not necessarily arise at the same time as the relevant class C franking credits and debits (see subsections 160ASED(4) and (9)).

    • 160ASEC(4)   [Interpretation]  

    In this section:

    venture capital credits
    at a particular time in a franking year is the total of the PDF's venture capital credits arising in the franking year and before that time.

    venture capital debits
    at a particular time in a franking year is the total of the PDF's venture capital debits arising in the franking year and before that time.

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