Income Tax Assessment Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-6 - THE IMPUTATION SYSTEM  

Division 220 - Imputation for NZ resident companies and related companies  

Subdivision 220-C - Modifications of other Divisions of this Part  

NZ franking companies ' franking accounts etc.

SECTION 220-205   Franking credit for payment of NZ franking company's withholding tax liability  

220-205(1)    
A *franking credit arises in the *franking account of a company on the day a payment is made of *withholding tax that the company is liable under section 128B of the Income Tax Assessment Act 1936 to pay, if:

(a) because of section 220-25 , the company satisfies the *residency requirement for the income year in which it *derived the income on which it was liable to pay the withholding tax; and

(b) the company is a *franking entity for the whole or part of that income year.

The amount of the credit equals the amount of the payment.

220-205(2)    
For the purposes of determining whether the company satisfies the *residency requirement for the income year described in paragraph (1)(a), section 205-25 has effect as if the derivation of the income described in that paragraph were an event specified in a relevant table for the purposes of that section.