Income Tax Assessment Act 1936
PART III
-
LIABILITY TO TAXATION
Division 7A
-
Distributions to entities connected with a private company
The following is a simplified outline of this Subdivision:
•
payments of genuine debts (section
109J
);
•
payments to other companies (section
109K
);
•
payments that are otherwise assessable or that are specifically excluded from assessable income (section
109L
).
•
loans to other companies (section
109K
);
•
loans that are otherwise assessable (section
109L
);
•
loans made in the ordinary course of business on ordinary commercial terms (section
109M
);
•
loans that meet criteria for minimum interest rate and maximum term (section
109N
);
•
certain loans and distributions by liquidators (section
109NA
);
•
loans that are for the purpose of funding the purchase of certain ESS interests under an employee share scheme (section
109NB
).
Subdivision D
-
Payments and loans that are not treated as dividends
SECTION 109H
109H
SIMPLIFIED OUTLINE OF THIS SUBDIVISION
The following is a simplified outline of this Subdivision:
This Subdivision sets out rules about payments and loans that are not treated as dividends.
The following sorts of payments are not treated as dividends:
The following sorts of loans are not treated as dividends:
An amalgamated loan may not be treated as a dividend if the Commissioner is satisfied that doing so would cause undue hardship. (See section 109Q .)
This Subdivision also provides for some loan repayments and interest payments to private companies to be disregarded if they are made with the intention of borrowing a similar amount from a private company later. (See section 109R .)
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