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Edited version of private advice
Authorisation Number: 1051896654528
Date of advice: 23 September 2021
Ruling
Subject: Public company
Question 1
Will the Commissioner form an opinion under subsection 103A(5) of the Income Tax Assessment Act 1936 (ITAA1936) that it is reasonable that Company A should be treated as a public company?
Answer
Yes.
Question 2
Will each company that is a subsidiary member of the income tax consolidated group of which Company A is the head company be a public company under subparagraph 103A(2)(d)(v) of the ITAA 1936?
Answer
Yes.
This ruling applies for the following period:
1 July 2020 to 30 June 2025
Relevant facts and circumstances
Company A is an unlisted public company with many shareholders and a significant amount of assets and profits.
The company has a policy of distributing most of its annual profits to its shareholders as dividends.
The financial reports of Company A are prepared in accordance with the relevant Australian accounting standards.
Company A's corporate governance is closely aligned with that of a listed public company.
Company A is the head company of an income tax consolidated group.
Relevant legislative provisions
Income Tax Assessment Act 1936 subsection 103A(1)
Income Tax Assessment Act 1936 subparagraph 103A(2)(d)(v)
Income Tax Assessment Act 1936 subsection 103A(4)
Income Tax Assessment Act 1936 subsection 103A(5)
Reasons for decision
Considering the specific circumstances of Company A, the Commissioner is of the opinion that it is reasonable that Company A should be treated as a public company for the purposes of subsection 103A(1) of the ITAA 1936. Therefore, Company A will be deemed to be a public company pursuant to subsection 103A(5) of the ITAA 1936.
This also means that each company that is a subsidiary member of Company A's income tax consolidated group is a public company under subparagraph 103A(2)(d)(v) and subsection 103A(4) of the ITAA 1936.