INCOME TAX ASSESSMENT ACT 1936 (ARCHIVE)

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

Division 7 - Calculation of attributable income of CFC  

Subdivision B - General modifications of Australian tax law  

SECTION 396   MODIFIED APPLICATION OF SECTIONS 25A AND 52  

396(2)   [References to non-taxable Australian asset]  

A reference in subsection (1) to a non-taxable Australian asset is a reference to:


(a) an asset other than a taxable Australian asset (within the meaning of Part IIIA of this Act); or


(b) a CGT asset other than one that has the necessary connection with Australia (within the meaning of the Income Tax Assessment Act 1997 ).

SECTION 399A   MODIFIED APPLICATION OF BAD DEBT ETC. PROVISIONS  

399A(1)  

(a) the amendment made to section 63 by section 13 of the Taxation Laws Amendment Act 1991 is to be taken to have applied to debts created or acquired at any time; and

SECTION 401   REDUCTION OF DISPOSAL CONSIDERATION OR CAPITAL PROCEEDS WHERE ATTRIBUTED INCOME NOT DISTRIBUTED  

401(2)   [References to disposal of an asset under Pt IIIA]  

For the purposes of this section, where the provision referred to in paragraph (1)(a) is in Part IIIA of this Act, as applied in accordance with this Division, references in this section to the disposal of an asset are references to the disposal of an asset within the meaning of Part IIIA of this Act as so applied.

401(3)  

(d)


(ii) if subparagraph (i) does not apply - only a proportion of each surplus (after any application of paragraph (b)) is to be taken into account under paragraph (1)(c), being the proportion calculated using the formula:


                    Consideration                    
Total grossed-up surplus

where:

Consideration means the amount of the consideration or the capital proceeds;

Total grossed-up surplus means the sum of the grossed-up amounts of the attribution surpluses (after any application of paragraph (b)).

Subdivision C - Modifications relating to Australian capital gains tax  

SECTION 405   INTERPRETATION  

405(2)   [Expressions used in Subdivision]  

An expression used in this Subdivision and in Part IIIA has the same meaning in this Subdivision as it has in that Part.

SECTION 407   407   CERTAIN PROVISIONS OF THIS SUBDIVISION TO BE TREATED AS PROVISIONS OF PART IIIA  
For the purposes of the application of Part IIIA in calculating the attributable income of the eligible CFC, where the expression ``provision of this Part'' or ``provisions of this Part'' is used in that Part, the expression is taken to include a reference to any of the provisions of this Subdivision.

SECTION 408A   408A   CERTAIN EVENTS BEFORE COMMENCING DAY IGNORED  
For the purposes of applying this Act in calculating the attributable income of an eligible CFC, if the eligible CFC's commencing day is after 30 June 1995:


(a) Part IIIA of this Act does not apply to disposals of assets of the eligible CFC; and


(b) Parts 3-1 and 3-3 of the Income Tax Assessment Act 1997 do not apply to CGT events involving the eligible CFC;

before the end of the commencing day.

Subdivision D - Modifications relating to losses  

SECTION 427   427   CERTAIN PROVISIONS TO BE DISREGARDED  



(a) paragraph 23(q) of this Act;

Division 10 - Post-attribution asset disposals  

SECTION 461   REDUCTION OF DISPOSAL CONSIDERATION WHERE ATTRIBUTED INCOME NOT DISTRIBUTED  

461(2)   [Reference to disposal of an asset]  

For the purposes of this section, where the provision referred to in paragraph (1)(a) is in Part IIIA , references in this section to the disposal of an asset are references to the disposal of an asset within the meaning of that Part.

461(3)  

(c)


(ii) if subparagraph (i) does not apply - only a proportion of each surplus (after any application of paragraph (a)) is to be taken into account under paragraph (1)(c), being the proportion calculated using the formula:


Consideration
Total surplus


where:
  • Consideration means the amount of the consideration or the capital proceeds;
  • Total surplus means the sum of the attribution surpluses (after any application of paragraph (a)).
  •