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Taxation Determination

TD 93/206

Income tax: Offshore Banking Units (OBU) - if an OBU carries on a business of trading in shares or debt instruments, such that the trading is an offshore banking (OB) activity for the purposes of subsection 121D(1), are dividends and interest derived from holding the shares or debt instruments assessable OB income?

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FOI status:

may be releasedFOI number: I 1216400

This Determination, to the extent that it is capable of being a 'public ruling' in terms of Part IVAAA of the Taxation Administration Act 1953 , is a public ruling for the purposes of that Part. Taxation Ruling TR 92/1 explains when a Determination is a public ruling and how it is binding on the Commissioner. Unless otherwise stated, this Determination applies to years commencing both before and after its date of issue. However, this Determination does not apply to taxpayers to the extent that it conflicts with the terms of a settlement of a dispute agreed to before the date of issue of the Determination (see paragraphs 21 and 22 of Taxation Ruling TR 92/20).

1. Yes. Subsection 121EE(2) of the Income Tax Assessment Act 1936 defines the assessable OB income of an OBU as so much of the OBU's assessable income as is derived from OB activities, or included in assessable income because of such activities.

2. Dividends and interest accruing from instruments held in an OBU's trading portfolio clearly fall under the second limb of subsection 121EE(2) and, therefore, qualify as assessable OB income.

Commissioner of Taxation
28/10/93

Previously issued as Draft TD 93/D201

References

ATO references:
NO NAT 93/3707-5

ISSN 1038 - 8982

Subject References:
Offshore banking,
OBUs,
assessable OB income

Legislative References:
ITAA 121D(1);
ITAA 121EE(2)

TD 93/206 history
  Date: Version: Change:
You are here 28 October 1993 Original ruling  
  13 October 2021 Consolidated ruling Addendum

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