INCOME TAX ASSESSMENT ACT 1997

CHAPTER 4 - INTERNATIONAL ASPECTS OF INCOME TAX  

PART 4-5 - GENERAL  

Division 815 - Cross-border transfer pricing  

Subdivision 815-B - Arm ' s length principle for cross-border conditions between entities  

Operative provisions

SECTION 815-145   Consequential adjustments  

815-145(1)  
The Commissioner may make a determination under subsection (2) in relation to an entity (the disadvantaged entity ) if:


(a) *arm ' s length conditions are taken by section 815-115 to operate; and


(b) the Commissioner considers that, if the arm ' s length conditions, instead of the actual conditions, had operated:


(i) the amount of the disadvantaged entity ' s taxable income for an income year might have been expected to be less than its actual amount; or

(ii) the amount of the disadvantaged entity ' s loss of a particular *sort for an income year might have been expected to be greater than its actual amount; or

(iii) the amount of the disadvantaged entity ' s *tax offsets for an income year might have been expected to be greater than their actual amount; or

(iv) an amount of *withholding tax payable in respect of interest or royalties by the disadvantaged entity might have been expected to be less than its actual amount; and


(c) the Commissioner considers that it is fair and reasonable that the actual amount mentioned in subparagraph (b)(i), (ii), (iii) or (iv) (as the case requires) be adjusted accordingly.

815-145(2)  
For the purpose of adjusting an amount as mentioned in paragraph (1)(c), the Commissioner may make a determination stating the amount that is (and has been at all times) the amount of the disadvantaged entity ' s:


(a) taxable income for the income year; or


(b) loss of a particular *sort for the income year; or


(c) *tax offsets, or tax offset of a particular kind, for the income year; or


(d) *withholding tax payable in respect of interest or royalties.

815-145(3)  
The Commissioner may take such action as the Commissioner considers necessary to give effect to a determination under this section.

815-145(4)  
The Commissioner must give a copy of a determination under this section to the disadvantaged entity.

815-145(5)  
A failure to comply with subsection (4) does not affect the validity of the determination.

815-145(6)  
(Repealed by No 81 of 2016)

815-145(7)  
An entity may give the Commissioner a written request to make a determination under this section relating to the entity. The Commissioner must decide whether or not to grant the request, and give the entity notice of the Commissioner ' s decision.

815-145(8)  
If the entity is dissatisfied with the Commissioner ' s decision, the entity may object, in the manner set out in Part IVC of the Taxation Administration Act 1953 , against that decision.


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