INCOME TAX ASSESSMENT ACT 1936 (ARCHIVE)

PART IIIAA - FRANKING OF DIVIDENDS  

Division 14 - Transitional provisions for conversion to 34% rate on 1 July 2000  

SECTION 160ATA   CONVERSION OF ACCOUNT BALANCES ON 1 JULY 2000  

160ATA(1)   [Dealing with franking accounts]  

On 1 July 2000, a company's franking accounts are dealt with as follows:

(a) first:

(i) the company's class C franking account balance (if any) at the start of that day is converted under section 160ATB to reflect the new company tax rate; and

(ii) the company's venture capital sub-account balance (if any) at the start of that day is converted under section 160ATB to reflect the new company tax rate;

(aa) then, if the company is a life assurance company, the company's class A franking account balance (if any) at the start of that day is converted under section 160ATC to reflect the new company tax rate and transferred to the class C franking account;

(b) then, any other credits and debits that occur on that day are processed.

160ATA(2)   [Where 1 July 2000 is first day of franking year]  

For the purposes of this Division, if 1 July 2000 is the first day of a franking year for the company, the balance in a franking account or sub-account of the company at the start of that day includes any credit arising for that account on that day under section 160APL (carry forward of surplus from previous franking year) or 160ASEE (carry forward of venture capital sub-account surplus from previous franking year).

160ATA(3)   [Tax paid at old rates]  

Section 160ATD tells you how to deal with franking credits and debits that arise on or after 1 July 2000 (and before 1 July 2001) but reflect tax paid at the old company tax rates.