INCOME TAX ASSESSMENT ACT 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-5 - CORPORATE TAXPAYERS AND CORPORATE DISTRIBUTIONS  

Division 167 - Companies whose shares carry unequal rights to dividends, capital distributions or voting power  

Subdivision 167-A - Rights to dividends or capital distributions  

Operative provisions

SECTION 167-35   Fixing rights if impracticable to work out market values etc.  

167-35(1)  
Each remaining *share is treated at the test time as carrying such a percentage of the rights to receive *dividends, and capital distributions, from the company as is reasonable worked out:


(a) at the test time; and


(b) having regard to the purpose of the unsatisfied condition.

167-35(2)  
In working out what is reasonable for subsection (1), have regard to the following:


(a) the company ' s *constitution;


(b) any agreements between the company and either or both of the following:


(i) any or all of the shareholders in the company;

(ii) any or all of the *associates of a shareholder in the company;


(c) any statement by the company of its policy in paying *dividends or making capital distributions;


(d) the ability of an entity to control (whether directly, or indirectly through one or more interposed entities) how the company pays dividends or makes capital distributions;


(e) how the company has previously paid dividends or made capital distributions;


(f) whether all classes of *shares carry substantially the same rights to receive dividends and capital distributions;


(g) the principle that:


(i) a *tax loss or bad debt should only be deductible; and

(ii) a *net capital loss should only be applied;
if a majority of the persons entitled to the benefits of dividend and capital distributions of the company is maintained.

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