Income Tax Assessment Act 1997
An entity is a deducting hybrid in relation to a payment or other amount if:
(a) the payment or other amount gives rise to a *deduction/deduction mismatch; and
(b) the entity is:
(i) for a payment - the entity that makes the payment; or
(ii) for an amount that represents the decline in value of a depreciating asset (see paragraph 832-110(4)(a) ) - the entity that holds the asset; or
(iii) for an amount that represents a share in the net loss of a partnership or other transparent entity (see paragraph 832-110(4)(b) ) - an entity that has an interest in the partnership or other transparent entity; and
(c) the entity is:
(i) a *liable entity in at least one deducting country; or
(ii) a *member of a *consolidated group.
[ CCH Note: S 832-550 will be amended by No 79 of 2020, s 3 and Sch 1 item 25, by substituting para (c), effective 1 October 2020 and applicable to assessments for income years starting on or after 1 January 2019. Para (c) will read:
(c) the entity:
(i) is a *liable entity in one deducting country (but not both); or
(ii) satisfies the residency test in subsection 832-555(9) in both deducting countries, and is also a liable entity in both deducting countries; or
(iii) is a *member of a *consolidated group or a *MEC group.