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Edited version of private advice
Authorisation Number: 1052445700129
Date of advice: 4 September 2025
Ruling
Subject: Income tax treatment of Arrangement 1 and Arrangement 2
In order to protect the privacy of the taxpayer and commercial in-confidence components of this private binding ruling, the following summary is provided:
Question 1
Does Arrangement 1 constitute debt interests pursuant to Division 974 of the Income Tax Assessment Act 1997 (ITAA 1997)?
Answer 1
Yes.
Question 2
Does Arrangement 2 constitute debt interests pursuant to Division 974 of the ITAA 1997?
Answer 2
Yes.
Question 3
Are Arrangement 1 and Arrangement 2 separate arrangements for the purposes of Division 230 of the ITAA 1997?
Answer 3
No.
Question 4
Do Arrangement 1 and Arrangement 2 together (Financial Arrangement) constitute a financial arrangement pursuant to Division 230 of the ITAA 1997?
Answer 4
Yes.
Question 5
If the answer to Question 4 is Yes, are any gains made from the Financial Arrangement assessable to the taxpayer pursuant to subsection 230-15(1) of the ITAA 1997?
Answer 5
Yes.
Question 6
If the answer to Question 4 is Yes, are any losses made from the Financial Arrangement deductible to the taxpayer pursuant to subsection 230-15(2) of the ITAA 1997?
Answer 6
Yes.
Question 7
If the answer to Question 6 is Yes, does subsection 230-15(5) of the ITAA 1997 apply to cap the deduction?
Answer 7
No.