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Edited version of private advice
Authorisation Number: 1051718831867
Date of advice: 15 July 2020
Ruling
Subject: Affiliates
Question
Are Individual A and Individual B affiliates of each other or of their child Individual C and spouse Individual D or Entity Y, whether under section 328-130 or 152-47 of the Income Tax Assessment Act 1997 (ITAA 1997)?
Answer
No, after reviewing the relevant factors and conditions, the Commissioner does not consider Individual A and Individual B to be affiliates of each other or to Individual C and spouse Individual D or Entity Y. The relationship between the parties does not demonstrate they are affiliates.
Question
Are Individual A and Individual B or their child Individual C and spouse Individual D, affiliates of' Entity X under section 328-130 of the ITAA 1997?
Answer
No, after reviewing the relevant factors and conditions, the Commissioner does not consider the individuals to be affiliates of Entity X. The relationship between the parties does not demonstrate they are affiliates.
This ruling applies for the following period:
Year ended 30 June 20XX
The scheme commences on:
1 July 20XX
Relevant facts and circumstances
Individual A and Individual B own rural properties.
Individual A and Individual B are not in business in their individual capacity. They are partners in the primary production partnership, Entity X.
Individual A and Individual B's child and spouse, Individual C and Individual D, are also in a primary production partnership, Entity Y.
Individual A and Individual B and Entity X do not consult in any way with Individual C and Individual D or Entity Y in respect of business activities. The business affairs are independent of each other.
They have separate bank borrowings.
They have separate brands, do not operate in a partnership, or concert with each other and retain their own separate approaches to primary production operations.
Relevant legislative provisions
Section 328-130 of the Income Tax Assessment Act 1997
Section 152-47 of the Income Tax Assessment Act 1997
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