Division 820 - Thin capitalisation rules  

Subdivision 820-F - Thin capitalisation rules for resident TC groups  

How this Division applies to a resident TC group

SECTION 820-570 [ARCHIVE]   Effect on safe harbour capital amount if foreign-controlled Australian ADI in the group on-lends section 128F amounts  

For the purposes of working out the *safe harbour capital amount of a *resident TC group for an income year, if:

(a) the group includes an entity (the ADI subsidiary ) that is at the end of the income year both a *100% subsidiary of a *foreign bank and an *ADI; and

(b) the ADI subsidiary has:

(i) issued *debentures or *debt interests covered by section 128F (which exempts interest on the debentures or debt interests from withholding tax) of the Income Tax Assessment Act 1936 ; and

(ii) made proceeds of the debentures or debt interests available to an *Australian permanent establishment of the foreign bank, as loans to the Australian permanent establishment, for use in its Australian business; and

(c) the Australian permanent establishment is not in the resident TC group at the end of the income year;

the group's *risk-weighted assets at a particular time are reduced by the total amounts of proceeds of the debentures or debt interests that are at that time so made available by the ADI subsidiary.

This section applies only to the 2001-2002 income year and to each of the next 4 income years.


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.