ato logo
Search Suggestion:

Amounts that will not be deemed to be dividends

Last updated 11 January 2005

The following transactions will not result in a deemed dividend:

a repayment of a debt owed by a private company to a shareholder or associate, provided the repayment is not more than the debt amount that would have been owed if the company and shareholder or associate had been dealing with each other at arm's length

  • a loan made in the ordinary course of a private company's business on the usual terms which it applies to arm's length loans of a similar type
  • a payment or loan which forms part of the assessable income of the shareholder or associate by virtue of some other provision of ITAA 1936 or the Income Tax Assessment Act 1997
  • a loan made during the course of winding up a company where the loan is either repaid or offset by distributions by the end of the income year following the year in which the loan is made
  • a payment or loan which has been specifically excluded from the assessable income of the shareholder or associate by virtue of an exempting provision in ITAA 1936
  • a loan made solely for the purpose of enabling the shareholder or associate to acquire shares or rights to shares under an employee share scheme to which Division 13A of ITAA 1936 applies
  • the forgiveness or release of a debt of a shareholder or associate under the Bankruptcy Act 1966.