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Edited version of your written advice
Authorisation Number: 1013097077430
Date of advice: 29 September 2016
Ruling
Subject: Interest withholding tax arising from the acquisition of Bonds
Company A derived interest through Bonds issued by Company B.
Question 1
Will Article 1 of the Convention between Australia and the Relevant Country for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income [2008] ATS 21 (the Relevant Convention) apply to Company A?
Answer
Yes.
Question 2
Will Article 11(3)(b) of the Relevant Convention apply to the interest arising from the Bonds issued by Company B and derived by Company A such that the interest will not be liable to tax in Australia?
Answer
Yes.
Question 3
Will interest income arising from Bonds issued by Company B and derived by Company A be subject to income tax in accordance with subsection 128B(5) of Income Tax Assessment Act 1936?
Answer
No.
This ruling applies for the following periods:
Income year ended 30 June 20xx to income year ended 30 June 20xx
The scheme commences on:
Income year ended 30 June 20xx
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