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Income Tax Regulations 1936 (Repealed)
PART 8A
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FOREIGN INCOME
Division 2
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Controlled foreign companies
REGULATION 152C
152C
LISTED COUNTRIES
For the definition of listed country in subsection 320(1) of the Act, a foreign country or a part of a foreign country listed in Schedule 10 is declared to be a listed country for the purposes of Part X of the Act.
152C(2)
(Repealed by SLI No 39 of 2015)
View history note
Hide history noteHistory
Pt 8A, comprising reg 152A - 152K, inserted by SR No 20 of 1991.
History
Div 2 heading inserted by SR No 115 of 2004.
For the definition of listed country in subsection 320(1) of the Act, a foreign country or a part of a foreign country listed in Schedule 10 is declared to be a listed country for the purposes of Part X of the Act.
History
Reg 152C(1) amended by SLI No 39 of 2015, reg 4 and Sch 1 items 23 and 24, by omitting " (1) " before " For the definition " and " Part 1 of " before " Schedule 10 " , effective 1 July 2015.
(Repealed by SLI No 39 of 2015)
History
Reg 152C(2) repealed by SLI No 39 of 2015, reg 4 and Sch 1 item 25, effective 1 July 2015. Reg 152C(2) formerly read:
152C(2)
For the definition of section 404 country in subsection 320(1) of the Act, a foreign country or a part of a foreign country listed in Part 2 of Schedule 10 is declared to be a section 404 country for the purposes of Part X of the Act.
History
S 152C substituted by SR No 248 of 2004.
Regs 152B, 152C, 152D and 152E substituted for reg 152B to 152H by SR No 115 of 2004, reg 3 and Sch 1 item 8, effective 1 July 2004. For transitional provision, see note under Div 1 heading. Reg 152C formerly read:
REGULATION 152C WHEN ARE INCOME OR PROFITS SUBJECT TO A REDUCTION OF TAX?
152C(1)
Subject to subregulation (2), in this Part, income or profits of a kind specified in subregulation 152D(1) derived by an entity in a relevant period are regarded as being ' subject to a reduction of tax ' in a broad-exemption listed country in a particular tax accounting period if:
(a) a law of that country; or
(b) a decree, proclamation, instrument or direction (however described) issued by a competent authority in that country; or
(c) an administrative arrangement in that country;provides, or has the effect, that the income or profits are, in the tax accounting period;
(d) exempt from tax under a tax law of the broad-exemption listed country; or
(e) subject to a concessional rate of tax; or
(f) not required to be used as the basis for:
(i) determining the amount of taxable income, taxable profits or tax base, as the case may be; orof the entity under a tax law of the broad-exemption listed country; or
(ii) establishing the tax liability;
(g) subject to subregulations (3) and (3A), reduced for the purposes of:
(i) determining the amount of taxable income, taxable profits or tax base, as the case may be; orof the entity under a tax law of the broad-exemption listed country; or
(ii) establishing the tax liability;
(h) subject to any other form of tax benefit that reduces the amount of tax that would otherwise be payable by the entity under a tax law of the broad-exemption listed country.HistoryReg 152C(1) amended by SR No 38 of 1992.
152C(2)
Income or profits derived by an entity in a relevant period are not to be regarded as subject to a reduction of tax in any tax accounting period if the income or profits are not subject to a reduction of tax in any of the relevant tax accounting periods that relate to the relevant period.
152C(3)
Paragraph (1)(g) does not apply to the reduction under the tax law of the broad-exemption listed country of income or profits derived by an entity referred to in subregulation 152C(1) to the extent that the tax law permits the deduction, from the income or profits, of losses or outgoings:
(a) incurred during the relevant period by the entity in deriving any income or profits; or
(b) incurred before the relevant period by the entity in deriving any income or profits if the losses or outgoings have not been allowed under that tax law as a deduction from any income or profits derived by the entity.HistoryReg 152C(3) amended by SR No 412 of 1994.
Reg 152C(3), (3A), (3B), (3C), (3D) and (3E) substituted for reg 152C(3) by SR No 38 of 1992.
152C(3A)
Subject to subregulation (3C), paragraph 152C(1)(g) does not apply to the reduction, under the tax law of a broad-exemption listed country, of income or profits derived by an entity referred to in subregulation 152C(1), to the extent that the tax law permits the deduction, from the relevant income or profits, of losses or outgoings incurred, in deriving any income or profits, by a company other than the entity (in this regulation called `the loss company ' ) if, during the period stated in subregulation (3B):
(a) the entity is:
(i) a CFC in relation to an Australian entity; and
(ii) a resident, within the meaning of section 332 of the Act, of the broad-exemption listed country; or
(b) the entity is a company, resident in Australia, that carries on a business in the broad-exemption listed country at or through a permanent establishment in the broad-exemption listed country.HistoryReg 152C(3A) substituted by SR No 412 of 1994.
Reg 152C(3), (3A), (3B), (3C), (3D) and (3E) substituted for reg 152C(3) by SR No 38 of 1992.
152C(3B)
The period referred to in subregulation (3A) is the period that:
(a) starts on the first day of the relevant period during which the losses or outgoings are transferred to the entity by the loss company; and
(b) ends at the end of the last day of the relevant period (whether or not it is the period mentioned in paragraph (a)) during which the losses or outgoings are deducted from the income or profits derived by the entity.HistoryReg 152C(3), (3A), (3B), (3C), (3D) and (3E) substituted for reg 152C(3) by SR No 38 of 1992.
152C(3C)
Subregulation (3A) applies only if:
(a) at all times during the loss period (as defined in subregulation (7)), the loss company is either:
(i) a resident, within the meaning of section 332 of the Act, of the broad-exemption listed country, and a CFC in relation to either:
(A) if the entity in subregulation (3A) is a CFC - the Australian entity referred to in paragraph (3A)(a); or
(B) in any other case - the entity referred to in paragraph (3A)(b); or
(ii) a company resident in Australia that carries on a business in the broad-exemption listed country at or through a permanent establishment in the broad-exemption listed country; and
(b) the loss company is a group company (within the rules stated in subregulation (3D)) in relation to the entity referred to in subregulation (3A) during:
(i) unless subparagraph (ii) applies - the whole of the period applicable under subregulation (3A); or
(ii) if the loss company was not in existence for the whole of that period - the whole of the portion of that period during which the loss company was in existence; and
(c) the losses or outgoings have not previously been allowed under the tax law mentioned in subregulation (3A) as a deduction from any income or profits derived by any entity.HistoryReg 152C(3C)(a) substituted by SR No 412 of 1994.
Reg 152C(3), (3A), (3B), (3C), (3D) and (3E) substituted for reg 152C(3) by SR No 38 of 1992.
152C(3D)
Subject to subregulation (3E), in order to find out for the purposes of subregulation (3C) whether a company is a group company during the period applicable under subregulation (3A) (in this subregulation called `the period ' ), the following rules must be applied:
(a) company A is a group company in relation to company B, during the period, if:
(i) one of the companies is a subsidiary (as defined in paragraph (b)) of the other company; orduring:
(ii) each of the companies is a subsidiary (as so defined) of company C;
(iii) unless subparagraph (iv) applies - the whole of the period; or
(iv) if company A or company B was not, or both of them were not, in existence for the whole of the period - for the whole of the portion of the period during which both of the companies were in existence;
(b) company A is a subsidiary of company B if company B owns a dominant parcel of shares (as defined in subregulation (8)) of company A during:
(i) if the circumstance stated in sub-paragraph (a)(iv) applies during a portion of the period - that portion of the period; or
(ii) in any other case - the whole of the period.HistoryReg 152C(3), (3A), (3B), (3C), (3D) and (3E) substituted for reg 152C(3) by SR No 38 of 1992.
152C(3E)
For the purposes of subregulation (3D), if company A is a subsidiary of company B (including the case where company A is a subsidiary of company B because of 1 or more further applications of this subregulation), every subsidiary of company A is taken to be a subsidiary of company B.HistoryReg 152C(3), (3A), (3B), (3C), (3D) and (3E) substituted for reg 152C(3) by SR No 38 of 1992.
152C(3F)
In spite of subregulation (3A), income or profits derived by an entity:
(a) that is a CFC; and
(b) to which subregulation 152C(1) applies;are to be taken to be `subject to a reduction of tax ' in the circumstances set out in subregulation (3G).
HistoryReg 152C(3F) inserted by SR No 412 of 1994.
152C(3G)
Subregulation (3F) applies if the income or profits are reduced, under a tax law of a broad-exemption listed country, by losses or outgoings incurred by an Australian resident company, other than those losses or outgoings that are recognised under the tax law of the broad-exemption listed country as being incurred by the Australian resident company in deriving income or profits on a business, in the broad-exemption listed country, at or through a permanent establishment in the broad-exemption listed country.HistoryReg 152C(3G) inserted by SR No 412 of 1994.
152C(4)
Income or profits in relation to Switzerland are taken to be subject to a concessional rate of tax if the income or profits are subject to a concessional rate of tax:
(a) under the law that imposes the federal foreign tax; or
(b) under the law that imposes the tax that is, in accordance with regulation 152K , to be treated as if it were an additional federal foreign tax.
152C(5)
For the purposes of paragraph (1)(h), `tax benefit ' in relation to a broad-exemption listed country, includes a credit, rebate or other tax concession provided in respect of income or profits, other than a credit or rebate for foreign tax payable under a law of another foreign country or tax payable under a law of Australia.
152C(6)
For the purposes of subregulation (3A), `deduction ' includes a reduction of the income or profits of an entity either directly or by means of:
(a) the consolidation of the activities of the loss company and the entity; or
(b) a payment by the entity to the loss company.HistoryReg 152C(6) inserted by SR No 38 of 1992.
152C(7)
For the purposes of subregulation (3C), `loss period ' in relation to a company, means the period from the start of the relevant period during which the losses or outgoings were incurred by the company to the end of:
(a) the last day of the period that is referred to in subregulation (3A); or
(b) if the company ceased to exist during the applicable period stated in paragraph (a) - the end of the day on which the company ceased to exist.HistoryReg 152C(7) inserted by SR No 38 of 1992.
152C(8)
For the purposes of paragraph (3D)(b), ' dominant parcel of shares ' in relation to the shares of a company, means:
(a) shares representing at least 60% of the paid-up share capital of that company; or
(b) shares conferring at least 60% of the total rights of the shareholders of that company to vote, or to take part in decision making of that company, concerning:
(i) the making of distributions of capital and profits of the company to its shareholders; and
(ii) the constituent document of the company; and
(iii) any variation of the share capital of the company; or
(c) shares conferring at least 60% of the total rights to distribution of capital and profits of that company:
(i) on winding up; and
(ii) otherwise than on winding up.HistoryReg 152C(8) inserted by SR No 38 of 1992.
Reg 152C amended by SR No 368 of 1997 and inserted by SR No 20 of 1991.
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