Income Tax Assessment Act 1997
An entity has an associate-inclusive control interest in a company in the circumstances set out in Subdivision A of Division 3 of Part X of the Income Tax Assessment Act 1936 . 975-160(2)
However, in working out whether an entity has an associate-inclusive control interest of a particular percentage for the purposes of section 975-155 , there are these modifications to the way Part X of that Act operates:
(a) that Part is applied to any company, including one acting as a trustee; and
(b) subsection 349(4) applies in all cases in working out which entity holds a direct control interest or a control tracing interest equal to 100%; and
(c) subsections 350(6) and (7) and 355(1) are ignored; and
(d) despite subsection 352(2) , an interposed entity may be taken into account in calculating an indirect control interest if the interposed entity is:
(i) a company of which the first entity or an *associate is a controller; or
(ii) a partnership or a trust; and
(e) section 354 applies as if it referred to partnerships rather than CFP ' s; and
(f) section 355 applies as if it referred to trusts rather than CFT ' s.
Part X of the Income Tax Assessment Act 1936 defines company to exclude a company in the capacity of a trustee.
Under subsection 349(4) of that Act, if 2 or more entities would have a direct control interest or a control tracing interest in a company or trust equal to 100%, only one of them holds the interest.
Subsections 350(6) and (7) of that Act deal with direct control interests in a company. They deal with interests held by Australian entities. Under subsection 355(1) , certain entities are taken to hold a control tracing interest in a trust equal to 100%.
Paragraphs (2)(d), (e) and (f) of this section are necessary because Part X of the Income Tax Assessment Act 1936 applies only to CFE ' s (which comprise CFC ' s, CFP ' s and CFT ' s).
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