Keeping a non-share capital account
A non-share capital account is an account maintained for tax purposes, rather than for financial accounting purposes. A non-share capital account contains similar information to that which is recorded in the shareholder's credit loan account, including such things as:
- the amount received as consideration for the issue of a non-share equity interest (for example, the 'at call' loan amount)
- the amount of the 'at call' loan that is a debt interest in a company but changes to an equity interest as a result of a material change
- the amount of the 'at call' loan that is a debt interest in a company but ceases to satisfy the $20 million turnover test, and
- repayments of principal to the connected entity/lender in respect of an equity interest.
Sections 164-15 and 164-20 of the ITAA 1997 specify the credits and debits that may be made to the non-share capital account.