INCOME TAX ASSESSMENT ACT 1936 (ARCHIVE)
(a) a person has not made a deduction from interest as required by subsection 221YL(2A) , or having made a deduction under that subsection from interest, has not complied with paragraph 221YN(1)(a) in relation to the deduction; and
(b) any withholding tax payable in respect of the interest has not been paid,
then, subject to subsection (2), the interest is not an allowable deduction.
(a) a person:
(i) has not made a deduction from a royalty as required by subsection 221YL(2G) ; or
(ii) having made a deduction under that subsection from a royalty, has not complied with paragraph 221YN(1)(a) in relation to the deduction; and
(b) any withholding tax payable in respect of the royalty has not been paid;
then, subject to subsection (2), the royalty is not an allowable deduction.
Where, any interest or royalty would, but for subsection (1) or (1A), be an allowable deduction in respect of a year of income and the withholding tax payable in respect of the interest or royalty is paid, the interest or royalty thereupon becomes an allowable deduction in respect of that year of income.
Where a member of a partnership is not a resident, then, for the purpose of calculating the amount that, in relation to him, is, for the purposes of Division 5 of Part III , the net income of the partnership or the partnership loss, as the case requires, subsections (1) and (1A) apply in relation to the partnership as if it were a person who is not a resident.
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