Income Tax Assessment Act 1997

CHAPTER 4 - INTERNATIONAL ASPECTS OF INCOME TAX  

PART 4-5 - GENERAL  

Division 820 - Thin capitalisation rules  

Subdivision 820-H - Control of entities  

TC direct control interest, TC indirect control interest and TC control tracing interest

SECTION 820-875   TC control tracing interest in a company, trust or partnership  

820-875(1)  
A thin capitalisation control tracing interest (or a TC control tracing interest ) that an entity holds in a company, trust or a partnership at a particular time is equal to the *TC direct control interest in the company, trust or partnership that the entity holds at that time.

820-875(2)  
Despite subsection (1), an entity is taken to hold a *TC control tracing interest in a company, trust or partnership that is equal to 100% at a particular time if, at that time:

(a) the entity and its *associate entities hold a total of *TC direct control interests in the company, trust or partnership that is 50% or more; or

(b) the following subparagraphs apply:

(i) the entity (the controlling entity ) and its associate entities hold a total of TC direct control interests that is 40% or more in the company, trust or partnership;

(ii) no other entity or entities (except the controlling entity, its associate entities or entities including the controlling entity or its associate entities) control the company, trust or partnership; or

(c) the entity (whether or not together with associate entities) controls the company, trust or partnership.

820-875(3)  
Paragraph (2)(b) does not apply if the *TC direct control interests mentioned in subparagraph (2)(b)(i) are held in a *corporate limited partnership.