Part 3: Working out attributable income and the amount to include in your assessable income

This part explains how to work out the attributable income of a CFC. Your share of the attributable income is included in your assessable income.

Even if the CFC passes the active income test, you will still need to read on. Passing the test will eliminate many, but not all, types of attributed income and gains.

Summary of part 3

Section 1	General assumptions for working out the attributable income of a CFC
Section 2	General modifications to the law
Section 3	Modifications to the treatment of capital gains and capital losses
Section 4	Quarantining of losses
Section 5	Working out the net income of a partnership
Section 6	Trust amounts
Section 7	Reduction of attributable income because of interim dividends
Section 8	Relief from double accruals taxation
Section 9	How much is included in assessable income

Section 1: General assumptions for working out the attributable income of a CFC

Attributable income is included directly in your assessable income. It is not necessary to aggregate amounts of attributable income as you trace through a chain of CFCs.

You include an amount in your assessable income as follows:

Like this

Not like this

Do include $300,000 from the first company and $200,000 from the second in your income.

Do not include $200,000 from the second company in the income of the first company, and $500,000 income from the first company in your own income.