What this form is for
If you have previously chosen to apply the group ratio test or third party debt test pursuant to Division 820 of the Income Tax Assessment Act 1997 (ITAA 1997) for an income year, the thin capitalisation rules apply to you based on the choice you have made. We refer to this choice as a thin capitalisation test choice.
You may use this revocation form to apply to the Commissioner for a decision under subsection 820–47(6) of the ITAA 1997 that you can revoke that choice.
Your application to revoke a choice for an income year must be made before the earlier of the following days:
- the day that is 4 years after you lodged your income tax return for that income year
- the day that is 4 years after the day you were required to lodge your income tax return for that income year.
A thin capitalisation test choice for an income year can only be revoked if the Commissioner is satisfied that it is fair and reasonable having regard to matters the Commissioner considers relevant. You will be notified in writing of the Commissioner’s decision.
Who can use this form
Use this form if you wish to apply to revoke a thin capitalisation test choice you made for an income year. You can use this form if:
- you have made a thin capitalisation test choice for an income year in the approved form, and
- you were a general class investor, outward investing financial entity (non-ADI) or inward investing financial entity (non-ADI) for an income year.
Outward investing financial entities (non-ADI) and inward investing financial entities (non-ADI) can only make a thin capitalisation test choice to apply the third party debt test.
If you were taken to have made a choice to apply the third party debt test under subsection 820–46(5) of the ITAA 1997, you can't use this form to revoke such a deemed choice.
A deemed choice will be taken not to have been made for an income year if all of the following apply:
- the Commissioner allows the entity that issued a debt interest to revoke a choice made under subsection 820–46(4) of the ITAA 1997 for that income year
- you are a member of the obligor group in relation to that debt interest; and
- you are not deemed to have made a thin capitalisation test choice for that income year as a result of you being a member of an obligor group in relation to any other debt interest.
For more information, see Deemed choice to use third party debt test.
Consequences of revoking a choice
You need to consider the following matters before revoking a choice.
Amendments to tax return
If the Commissioner is satisfied that it is fair and reasonable to allow you to revoke a previous choice, you will be notified in writing. Upon receipt of our notification granting your request to revoke a previous choice, you and any members of your obligor group will need to lodge an amended International Dealings Schedule and tax return for the relevant income year, unless our notification indicates otherwise.
Debt deduction creation rules
If you revoke a third party debt test choice for an income year, you may be subject to the debt deduction creation rules in Subdivision-EAA of the ITAA 1997 in respect of that income year.
Get this form
Access a copy of the Thin capitalisation test choice revocation form (NAT 75706, PDF 292KB)This link will download a file.
After you have completed this form
Ensure you have a completed signed electronic copy of this form and an electronic copy of your original signed and dated thin capitalisation test choice form (your completed request).
Lodge your completed request with the ATO to LargeServiceTeam@ato.gov.au. Use the subject line Thin Capitalisation Test Choice Revocation of Choice.
Email lodgment is not a secure channel. You may redact your TFN on the thin capitalisation test choice form for greater security. If you have concerns with lodging via email, contact our Large Services Team for further information about using a secure lodgement channel via LargeServiceTeam@ato.gov.au.
Keep a copy of your completed, signed and dated form for your records.