INCOME TAX ASSESSMENT ACT 1936 (ARCHIVE)

PART III - LIABILITY TO TAXATION  

Division 18 - Credits in respect of foreign tax  

SECTION 160AF   CREDITS IN RESPECT OF FOREIGN TAX  

160AF(4)   [Australian tax payable where undistributed profits tax paid]  

Where additional tax under Division 7 has been paid, or is payable, by a private company upon the undistributed amount of the company of the year of income, the amount of Australian tax payable in respect of foreign income by the company in the year of income is, for the purposes of subsection (1), the sum of:

(a) the amount ascertained in accordance with the preceding provisions of this section as being the amount of Australian tax so payable; and

(b) the amount ascertained by applying the rate of the additional tax to an amount that bears to the adjusted net foreign income of the company of the year of income the same proportion as that undistributed amount bears to the company's taxable income of the year of income.

160AF(8)    

"average rate of Australian tax"
, in relation to a taxpayer, means an amount per dollar ascertained by dividing the amount of income tax that would be assessed under this Act in respect of the taxpayer's taxable income of the year of income if -

(a) the taxpayer was not entitled to any rebate of tax (other than a rebate under subsection 23AB(7) , section 79A or 79B or Subdivision A of Division 17 of Part III , or under an Act imposing income tax for the year of tax) or credit against the taxpayer's liability for tax; and

(b) the taxpayer was not liable to pay additional tax under Division 7 ,

by a number equal to the number of whole dollars in that taxable income;