INCOME TAX ASSESSMENT ACT 1936

PART X - ATTRIBUTION OF INCOME IN RESPECT OF CONTROLLED FOREIGN COMPANIES  

Division 4 - Attribution accounts  

SECTION 369   INDIRECT ATTRIBUTION ACCOUNT INTEREST IN AN ENTITY  

369(1)   [Calculation of indirect attribution account interest]  

The indirect attribution account interest that an entity (in this section called the " bottom entity " ) holds in another entity (in this section called the " top entity " ) is calculated in accordance with this section.

369(2)   [Interposed entity]  

An interposed entity is not to be taken into account in calculating the indirect attribution account interest unless the entity is an attribution account entity.

369(3)   [One interposed entity]  

If there is only one entity interposed between the bottom entity and the top entity, the indirect attribution account interest is calculated by multiplying the direct attribution account interest that the bottom entity holds in the interposed entity by the direct attribution account interest that the interposed entity holds in the top entity.

369(4)   [2 interposed entities]  

If there are 2 entities interposed between the bottom entity and the top entity, the indirect attribution account interest is calculated:


(a) by multiplying the direct attribution account interest that the bottom entity holds in the first interposed entity by the direct attribution account interest that the first interposed entity holds in the second interposed entity; and


(b) by multiplying the result of the calculation in paragraph (a) by the direct attribution account interest that the second interposed entity holds in the top entity.

369(5)   [3 or more interposed entities]  

If there are 3 or more entities interposed between the bottom entity and the top entity, the indirect attribution account interest is calculated:


(a) by multiplying the direct attribution account interest that the bottom entity holds in the first interposed entity by the direct attribution account interest that the first interposed entity holds in the second interposed entity; and


(b) by multiplying the result of the multiplication referred to in paragraph (a) by the direct attribution account interest that the second interposed entity holds in the third interposed entity;

and so on, ending with a multiplication by the direct attribution account interest that the last interposed entity holds in the top entity.

369(6)   [Entity interposed between 2 entities]  

For the purposes of this section, an entity (in this subsection called the 'second entity " ) is interposed between 2 other entities (in this subsection called the " first entity' and the " third entity " respectively) if, and only if:


(a) the first entity has a direct attribution account interest in the second entity; and


(b) the second entity has a direct attribution account interest in the third entity.


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