Income Tax Assessment Act 1997



Division 719 - MEC groups  

Subdivision 719-B - MEC groups and their members  

Basic concepts

SECTION 719-30   Treating entities as wholly-owned subsidiaries by disregarding employee shares  


The object of this section is to ensure that an entity is not prevented from being a * wholly-owned subsidiary of another entity, just because there are minor holdings of * membership interests in an entity issued under * arrangements for employee shareholdings.


For the purposes of this Division, in determining whether an entity is a *wholly-owned subsidiary of another entity, disregard:

(a) particular *shares in a company if the shares are covered by subsection (3) and the total number of those shares is not more than 1% of the number of ordinary shares in the company; and

(b) particular *membership interests in an entity if the membership interests are covered by subsection (5) and the total number of those membership interests is not more than 1% of the number of membership interests of that kind in the entity.


A *share or *membership interest in a company is covered by this subsection if:

(a) the entity who holds the beneficial interest in the share or membership interest acquired that beneficial interest:

(i) under an *employee share scheme; or

(ii) by exercising a right, a beneficial interest in which was acquired under an employee share scheme; and

(b) paragraphs 83A-105(1)(a) and (b) and subsection 83A-105(2) apply to the beneficial interest acquired under the scheme; and

(c) in the case of a membership interest - the interest is part of a stapled security.

(Repealed by No 133 of 2009)

(Repealed by No 133 of 2009)

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