Division 7A calculator and decision tool

About the tool

The Division 7A calculator and decision tool has two main components:

  • Decision tool

This component will ask you a series of questions to help you determine whether a direct transaction by a private company to a shareholder or their associate will be deemed a dividend.

  • Calculator

This component will:

  • calculate the minimum yearly repayment required on a loan to avoid a deemed dividend arising under Division 7A
  • calculate the amount of the loan not repaid by the end of an income year.

Information you will need

To calculate the minimum yearly repayment you will need to know:

  • the income year in which the loan was made
  • the original amount of the loan or the amount of the loan not repaid by the end of the previous year of income
  • the actual term of the loan, and
  • date and amount of any repayments attributable to that loan.

The tool will not cater for situations where:

  • there are indirect transactions through one or more interposed entities
  • the shareholder or shareholder’s associate is a company, trust or partnership (i.e. the shareholder or shareholder’s associate is not a ‘natural person’)
  • a private company is presently entitled to income of a trust estate that has not been paid and there has been a loan, payment or debt forgiven by the trustee of the trust estate to a shareholder or shareholder’s associate of the private company, or
  • the private company uses a substituted accounting period.

Next step:

See also:

Last modified: 14 Jan 2016QC 21036