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Edited version of private advice
Authorisation Number: 1051753060920
Date of advice: 17 September 2020
Ruling
Subject: Liquidator's distribution
Question 1
Will the distributions by the Liquidator be a dividend under section 47 of the Income Tax Assessment Act 1936 (ITAA 1936) or a non-share dividend as defined in section 974-120 of the Income Tax Assessment Act 1997 (ITAA 1997)?
Answer
No.
Question 2
Will section 45B of the ITAA 1936 apply to the distributions by the Liquidator?
Answer
No.
Question 3
Will Part IVA of the ITAA 1936 apply to the distributions by the Liquidator?
Answer
No.
This ruling applies for the following period:
1/7/20XX to 30/6/20XX
The scheme commences on:
XX/XX/20XX
Relevant facts and circumstances
Company A is the trustee of C Unit Trust and holds non-share equity interests issued by Company B.
Due to the liquidation of Company B, Company A will receive distributions by the Liquidator.
Relevant legislative provisions
Income Tax Assessment Act 1936 Subsection 47(1)
Income Tax Assessment Act 1936 Section 45B
Income Tax Assessment Act 1936 Part IVA
Income Tax Assessment Act 1997 Section 974-120
Unless otherwise stated, all legislative references in this ruling are to the Income Tax Assessment Act 1936 (ITAA 1936)
Reasons for decision
Question 1
The proposed distributions by the Liquidator of Company B to the C Unit Trust will not be a dividend or a non-share dividend pursuant to section 47.
Question 2
Section 45B of the ITAA 1936 will not apply to the distributions by the Liquidator.
Question 3
Part IVA will not apply to the distributions by the Liquidator.