Income Tax Assessment Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-5 - CORPORATE TAXPAYERS AND CORPORATE DISTRIBUTIONS  

Division 166 - Income tax consequences of changing ownership or control of a widely held or eligible Division 166 company  

Subdivision 166-E - Concessional tracing rules  

Other rules relating to voting power and rights

SECTION 166-270   Single notional entity stakeholders taken to have minimum voting control, dividend rights and capital rights  

Minimum control of voting power

166-270(1)  
If:


(a) the *ownership test time is after the start of the *test period; and


(b) a single notional entity mentioned in section 166-225 or 166-255 has voting power in a company; and


(c) the voting power that the entity has at the ownership test time is greater than the voting power that the entity had at the start of the test period;

then the entity is taken to have voting power in the company at the ownership test time only to the extent that it had it at the start of the test period.

Minimum percentage of rights to dividends and capital

166-270(2)  
If:


(a) the *ownership test time is after the start of the *test period; and


(b) a single notional entity mentioned in section 166-225 or 166-255 has a percentage of rights to the *dividends or distributions of capital of a company; and


(c) the percentage that the entity has rights to at the ownership test time is greater than the percentage (the lower percentage ) of the dividends or distributions of capital of the company that the entity had rights to at the start of the test period;

then the entity is taken to have rights to the lower percentage of the dividends or distributions of capital at the ownership test time.

Acquisition of tested company by new interposed entity - minimum control of voting power

166-270(3)  
If:


(a) the *ownership test time is after the start of the *test period; and


(b) at the start of the test period, a single notional entity mentioned in section 166-225 had voting power in a company (disregarding subsection 166-230(5) ); and


(c) under subsection 166-230(5) , a new interposed entity is taken to have held that voting power at the start of the test period; and


(d) at the ownership test time, the voting power in the company held indirectly by stakeholders covered by subsection 166-230(1) is greater than the voting power that the single notional entity had at the start of the test period;

then the stakeholders referred to in paragraph (d) are, collectively, taken to have indirect voting power in the company at the ownership test time only to the extent that the single notional entity had it at the start of the test period.

Acquisition of tested company by new interposed entity - minimum percentage of rights to dividends and capital

166-270(4)  
If:


(a) the *ownership test time is after the start of the *test period; and


(b) at the start of the test period, a single notional entity mentioned in section 166-225 had a percentage of rights to the *dividends or distributions of capital of a company (disregarding subsection 166-230(5) ); and


(c) under subsection 166-230(5) , a new interposed entity is taken to have had those rights at the start of the test period; and


(d) the percentage that stakeholders covered by subsection 166-230(1) have rights to indirectly at the ownership test time is greater than the percentage (the lower percentage ) of the dividends or distributions of capital of the company that the single notional entity had rights to at the start of the test period;

then the stakeholders referred to in paragraph (d) are, collectively, taken to have indirect rights to the lower percentage of the dividends or distributions of capital at the ownership test time.


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