INCOME TAX ASSESSMENT ACT 1997

CHAPTER 4 - INTERNATIONAL ASPECTS OF INCOME TAX  

PART 4-5 - GENERAL  

Division 768 - Foreign non-assessable income and gains  

Subdivision 768-A - Returns on foreign investment  

Foreign equity distributions on participation interests

SECTION 768-5   Foreign equity distributions on participation interests  

Foreign equity distributions received directly

768-5(1)  
A *foreign equity distribution is not assessable income, and is not *exempt income, of the entity to which it is made if:


(a) the entity is an Australian resident and a *corporate tax entity; and


(b) at the time the distribution is made, the entity satisfies the participation test in section 768-15 in relation to the company that made the distribution; and


(c) the entity:


(i) does not receive the distribution in the capacity of a trustee; or

(ii) receives the distribution in the capacity of a trustee of a *public trading trust; and


(d) the distribution is not one to which section 768-7 (which is about foreign income tax deductions) applies.

Foreign equity distributions received through interposed trusts and partnerships

768-5(2)  
An amount is not assessable income, and is not *exempt income, of an entity if:


(a) the entity is a beneficiary of a trust or a partner in a partnership, an Australian resident and a *corporate tax entity; and


(b) the amount is all or part of the *net income of the trust or partnership that would, apart from this subsection, be included in the entity ' s assessable income because of:


(i) Division 276 ; or

(ii) Division 5 or 6 of Part III of the Income Tax Assessment Act 1936 ; and


(c) the amount can be attributed (either directly or indirectly through one or more interposed trusts or partnerships that are not *corporate tax entities) to a *foreign equity distribution; and


(d) at the time the distribution is made, the entity satisfies the participation test in section 768-15 in relation to the company that made the distribution; and


(e) the entity:


(i) does not receive the distribution in the capacity of a trustee; or

(ii) receives the distribution in the capacity of a trustee of a *public trading trust; and


(f) the distribution is not one to which section 768-7 (which is about foreign income tax deductions) applies.

768-5(3)  
An amount that is *non-assessable non-exempt income under subsection (2) is taken, for the purpose of section 25-90 (about deductions relating to foreign non-assessable non-exempt income) to be derived from the same source as the *foreign equity distribution.


 

Disclaimer and notice of copyright applicable to materials provided by CCH Australia Limited

CCH Australia Limited ("CCH") believes that all information which it has provided in this site is accurate and reliable, but gives no warranty of accuracy or reliability of such information to the reader or any third party. The information provided by CCH is not legal or professional advice. To the extent permitted by law, no responsibility for damages or loss arising in any way out of or in connection with or incidental to any errors or omissions in any information provided is accepted by CCH or by persons involved in the preparation and provision of the information, whether arising from negligence or otherwise, from the use of or results obtained from information supplied by CCH.

The information provided by CCH includes history notes and other value-added features which are subject to CCH copyright. No CCH material may be copied, reproduced, republished, uploaded, posted, transmitted, or distributed in any way, except that you may download one copy for your personal use only, provided you keep intact all copyright and other proprietary notices. In particular, the reproduction of any part of the information for sale or incorporation in any product intended for sale is prohibited without CCH's prior consent.