Income Tax Assessment Act 1997



Division 220 - Imputation for NZ resident companies and related companies  

Subdivision 220-C - Modifications of other Divisions of this Part  

NZ franking companies ' franking accounts etc.

SECTION 220-205   Franking credit for payment of NZ franking company's withholding tax liability  

A *franking credit arises in the *franking account of a company on the day a payment is made of *withholding tax that the company is liable under section 128B of the Income Tax Assessment Act 1936 to pay, if:

(a) because of section 220-25 , the company satisfies the *residency requirement for the income year in which it *derived the income on which it was liable to pay the withholding tax; and

(b) the company is a *franking entity for the whole or part of that income year.

The amount of the credit equals the amount of the payment.

For the purposes of determining whether the company satisfies the *residency requirement for the income year described in paragraph (1)(a), section 205-25 has effect as if the derivation of the income described in that paragraph were an event specified in a relevant table for the purposes of that section.


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