• How is the sometimes exempt income loss worked out?

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    The sometimes exempt income loss is worked out by:

    • assuming that the CFC had passed the active income test and did not have the benefit of the de minimis exemption
    • working out the amounts that would be included in the notional assessable income - called the sometimes exempt income
    • working out notional allowable deductions that would be available if the sometimes exempt income were assessable - called sometimes exempt deductions.

    If sometimes exempt deductions of a class of income are more than the sometimes exempt income of that class, the difference is a sometimes exempt income loss.

    Last modified: 05 Dec 2006QC 17522