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Edited version of private ruling
Authorisation Number: 1011624708222
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Ruling
Subject: Australian taxation implications of proposed lease transactions
The ruling concerned the following:
1. Will Z have a permanent establishment (PE) in country X for the purposes of subsection 23AH(2) of the Income Tax Assessment Act 1936 (ITAA 1936) only during the periods of time when equipment that it leases to Y under a relevant equipment operating lease arrangement is in country X?
2. Does Division 250 of the ITAA 1997 apply to Z in relation to the relevant operating lease arrangements entered into with Y on or after 1 July 2007?
The Commissioner ruled that:
1. Yes, Z will have a PE in country X for the purposes of subsection 23AH(2) of the ITAA 1936 only during the periods of time when equipment that it leases to Y under a relevant equipment operating lease arrangement is in country X.
2. Yes, Division 250 of the ITAA 1997 will apply to Z in relation to the relevant operating lease arrangements entered into with Y on or after 1 July 2007?