A corporate limited partnership is considered to be closely held for the purposes of Division 7A if it has fewer than 50 members or an entity has, directly or indirectly, and for the entity's own benefit, an entitlement to a 75% or greater share of the income or capital of the partnership.
Kariba LP is a limited partnership that has one general partner and three limited partners. Kariba LP is a corporate limited partnership. As Kariba LP has less than 50 members, it is subject to the application of Division 7A from the 2009-10 income year.
Michael has an entitlement to an 80% share of the income of two fixed trusts. The two trusts have between them an entitlement to 100% of the income of a corporate limited partnership. For the purpose of determining whether there is a closely-held corporate limited partnership, Michael has, indirectly and for his own benefit, an entitlement to a 75% or greater share of the income of the partnership.