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INCOME TAX ASSESSMENT ACT 1997 - SECT 820.609

Effect on classification of head company or single company

  (1)   The * head company or single company is an outward investing entity (ADI) for a period (the trial period ) that is all or part of the grouping period if:

  (a)   apart from this Subdivision, the head company or single company would be an * outward investing entity (ADI) for the trial period; or

  (b)   apart from this Subdivision, the head company or single company would be:

  (i)   an * outward investing entity (non - ADI) and an * outward investor (financial) for the trial period; or

  (ii)   an * outward investing entity (non - ADI) and an * outward investor (general) for the trial period;

    and at least one of the * Australian permanent establishments is a * permanent establishment through which a * foreign bank carries on banking * business in Australia.

  (2)   The * head company is also an outward investing entity (ADI) for the trial period if, apart from this Subdivision:

  (a)   section   820 - 585 would prevent the disallowance of a * debt deduction for the income year including the trial period; or

  (b)   section   820 - 587 would apply Subdivision   820 - D to the head company as if it were an * outward investing entity (ADI) for the trial period.

  (3)   The single company is also an outward investing entity (ADI) for the trial period if it is both a * foreign controlled Australian company and an * ADI for that period.

  (4)   The * head company or single company is an inward investing entity (ADI) for the trial period if:

  (a)   apart from this Subdivision, it would be an * inward investment vehicle (general) or an * inward investment vehicle (financial), and not an * outward investor (general) or an * outward investor (financial), for the trial period; and

  (b)   at least one of the * Australian permanent establishments is a * permanent establishment through which a * foreign bank carries on banking * business in Australia.

  (5)   The * head company or single company is an outward investing entity (non - ADI) and an outward investor (financial) for the trial period if, apart from this Subdivision, it would be an * outward investing entity (non - ADI) and:

  (a)   an * outward investor (financial); or

  (b)   an * outward investor (general);

for that period, and:

  (c)   at least one of the * Australian permanent establishments is a * permanent establishment of a * foreign entity that is a * financial entity; and

  (d)   none of the Australian permanent establishments is a permanent establishment through which a * foreign bank carries on banking * business in Australia.

  (6)   The * head company or single company is an inward investing entity (non - ADI) and an inward investment vehicle (financial) for the trial period if, apart from this Subdivision, it would be an * inward investing entity (non - ADI) and:

  (a)   an * inward investment vehicle (financial); or

  (b)   an * inward investment vehicle (general);

for that period and not an * outward investor (general) or an * outward investor (financial) for that period and:

  (c)   at least one of the * Australian permanent establishments is a * permanent establishment of a * foreign entity that is a * financial entity; and

  (d)   none of the Australian permanent establishments is a permanent establishment through which a * foreign bank carries on banking * business in Australia.

  (7)   This section has effect despite any other provision of this Division, except Subdivision   820 - EA and section   820 - 610.

Note:   If the head company or single company is an outward investor (financial) or inward investment vehicle (financial) under this section and satisfies subsection   820 - 430(5), it may choose under Subdivision   820 - EA to be treated as an outward investing entity (ADI). Section   820 - 603 affects whether the company satisfies that subsection, by treating as part of the company each relevant foreign financial entity's Australian permanent establishment.


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