Income Tax (Transitional Provisions) Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-6 - THE IMPUTATION SYSTEM  

Division 205 - Franking accounts  

SECTION 205-10   Converting the franking account balance to a tax paid basis - companies whose 2001-02 franking year ends on 30 June 2002  

205-10(1)    

This section applies to companies whose 2001-02 franking year ends on 30 June 2002 under former Part IIIAA of the Income Tax Assessment Act 1936 (the 1936 Act ).

205-10(2)    

If the company has a franking surplus of a particular class under former Part IIIAA of the 1936 Act at the end of 30 June 2002:

(a) no franking credit arises under former section 160APL of that Act because of the surplus; and

(b) a franking credit arises on 1 July 2002 in the franking account established under section 205-10 of the Income Tax Assessment Act 1997 (the 1997 Act ) for the company.

The amount of the franking credit is worked out under subsection (3).

205-10(3)    
The franking credit generated under paragraph (2)(b) from a franking surplus of a class specified in column 2 of the following table is worked out using the formula in column 3 of the table for that class.

Conversion of 1936 Act franking surplus into 1997 Act franking credit
Item	Franking surplus	Franking credit generated under paragraph (2)(b)
1	class A franking surplus	Amount of the class A franking surplus at the end of 30 June 2002 under the 1936 Act	×	39   61
.
2	class B franking surplus	Amount of the class B franking surplus at the end of 30 June 2002 under the 1936 Act	×	33   67
.
3	class C franking surplus	Amount of the class C franking surplus at the end of 30 June 2002 under the 1936 Act	×	30   70