This information may not apply to the current year. Check the content carefully to ensure it is applicable to your circumstances.
End of attention
A deduction is not normally available for the payment of a dividend. A notional allowable deduction is available, however, for an eligible finance share dividend paid by a CFC. Broadly, this is a dividend paid on a share issued under a preference share financing arrangement with an Australian financial intermediary - for example, a bank - and its subsidiaries. In effect, the issue of eligible finance shares is treated as a type of loan.
Dividends on eligible finance shares are treated as an interest expense. A notional allowable deduction is available for the dividends to the extent a notional allowable deduction would have been payable if the dividends had been an interest outgoing.
Last modified: 05 Dec 2006QC 18000