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Edited version of your private ruling
Authorisation Number: 1012119147550
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Ruling
Subject: financing transaction
Question 1
That section 207-145 of the Income Tax Assessment Act 1997 (ITAA 1997) will not apply to deny entity A a tax offset in respect of the franking credits on certain distributions.
Answer
Yes.
Question 2
That, for the purposes of section 208-200(1) of the ITAA 1997, the franked distributions made by entity B to entity C will give rise to a franking credit for entity A as head company of the entity A XYZ Group under item 5 of the table in section 208-130 of the ITAA 1997.
Answer
Yes.
Question 3
That section 177EA(5)(b) of the ITAA 1936 will not apply in respect of the identified schemes.
Answer
Yes.
Question 4
That for the purposes of section 230-15 of the ITAA 1997, any interest incurred by entity A in respect of the loan should be regarded as either:
(i) a loss made in gaining or producing assessable income; or
(ii) a loss necessarily made in carrying on a business for the purpose of gaining or producing assessable income,
by entity B as head company of the entity B XYZ group.
Answer
Yes.
Question 5
That section 177F(1)(b) of the ITAA 1936 will not apply in respect of the identified schemes.
Answer
Yes.
This ruling applies for the following periods:
n 1 January 2011 to 31 December 2011
n 1 January 2012 to 31 December 2012
n 1 January 2013 to 31 December 2013
The scheme commences on:
20 May 2011
Relevant facts and circumstances
The taxpayer applied for a private ruling in relation to a financing transaction.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 207-145,
Income Tax Assessment Act 1997 section 208-200,
Income Tax Assessment Act 1936 section 177EA,
Income Tax Assessment Act 1997 section 230-15 and
Income Tax Assessment Act 1936 section 177F.
Reasons for decision
Not applicable.