INCOME TAX ASSESSMENT ACT 1997 (ARCHIVE)

CHAPTER 4 - INTERNATIONAL ASPECTS OF INCOME TAX  

PART 4-5 - GENERAL  

Division 820 - Thin capitalisation rules  

Subdivision 820-F - Thin capitalisation rules for resident TC groups  

How to construct a resident TC group for an income year

SECTION 820-530 (ARCHIVE)   Entities making up group before end of income year  

820-530(1)    
A *resident TC group for an income year is treated as consisting, at a particular time (the test time ) before the end of that income year, only of:

(a) the companies in the group determined under subsection (2); and

(b) each partnership in the group, all interests in whose income and capital are beneficially owned at the test time by one or more of those companies; and

(c) each trust in the group, all interests in whose income and capital are beneficially owned at the test time by one or more entities, each of which is covered by paragraph (a) or (b) of this subsection; and

(d) for each *foreign bank:

(i) that is in the *maximum TC group; and

(ii) that, at the test time, is a 100% subsidiary of the *top entity of the *maximum TC group or is that top entity;

each *Australian permanent establishment that is in the resident TC group, and through which the foreign bank carries on its banking business in Australia at the test time.

Note:

This section affects how Subdivision 820-G (about calculating average values) applies to the group when there are 2 or more measurement days to consider.

820-530(2)    
The companies in the group determined under this subsection are:

(a) in the case of a resident TC group under section 820-505 - each company in the group that, at the test time:

(i) is a 100% subsidiary of the *top entity of the *maximum TC group or is that top entity; and

(ii) meets the conditions in subsection 820-505(3) ; or

(b) in the case of a resident TC group under section 820-510 that consists of only one subgroup constructed under subsection 820-510(3) - each company in the group that, at the test time:

(i) is a 100% subsidiary of the node entity or is the node entity; and

(ii) is a 100% subsidiary of the top entity of the maximum TC group or is that top entity; and

(iii) meets the conditions in subsection 820-505(3) ; or

(c) in the case of a resident TC group under section 820-510 that consists of 2 or more subgroups constructed under subsection 820-510(3) - each company in the group that, at the test time:

(i) is a 100% subsidiary of the link company mentioned in paragraph 820-510(2)(a) or is that link company; and

(ii) is a 100% subsidiary of the top entity of the maximum TC group or is that top entity; and

(iii) meets the conditions in subsection 820-505(3) .