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INCOME TAX ASSESSMENT ACT 1936 (ARCHIVE)

PART IIIAA - FRANKING OF DIVIDENDS  

Division 1A - Circumstances in which a taxpayer can qualify for a franking credit, a franking rebate or the intercorporate dividend rebate  

Subdivision A - Preliminary  

SECTION 160APHD  

160APHD  DEFINITIONS  

In this Division, unless the contrary intention appears:

associate has the meaning given by section 318 but includes:


(a) in relation to a trustee - the controller of the trust; and


(b) in relation to a company that is a member of a wholly-owned group (determined in accordance with Subdivision 975-W of the Income Tax Assessment Act 1997) - any other company that is a member of the group.

benchmark portfolio of shares has the meaning given by section 160AQZH.

closely held fixed trust : a trust is a closely held fixed trust at a particular time if, at that time, it is a fixed trust and not more than 20 entities (as defined in section 960-100 of the Income Tax Assessment Act 1997 and counting entities who are associates as one entity) have interests in the trust that together entitle them to not less than 75% of:


(a) the beneficial interests in the income of the trust; or


(b) the beneficial interests in the capital of the trust.

controller , in relation to a trust, means a person:


(a) who beneficially owns, or is able in any way, whether directly or indirectly, to control the application of more than 50% of the interests in the trust property or in the trust income; or


(b) who has power to appoint or remove the trustee of the trust; or


(c) according to whose directions, instructions or wishes, the trustee of the trust is accustomed or under an obligation, whether formal or informal, to act.

distribution : a distribution in respect of an interest in shares is taken to be made in the circumstances specified in subsection 177EA(15).

employee share scheme security means:


(a) a share that is, or except for subsections 139C(3) and (4) would be, a qualifying share for the purposes of Division 13A of Part III; or


(b) a share acquired as a result of the exercise of a qualifying right within the meaning of Division 13A of Part III; or


(c) an interest in a share where:


(i) it is an interest in a share referred to in paragraph (a) or (b); and

(ii) if it is defeasible or subject to forfeiture - it becomes indefeasible, or ceases to be subject to forfeiture (other than forfeiture resulting from fraud, dishonesty or defalcation), as the case may be, within 10 years after it was issued; and

(iii) if it is an interest as a beneficiary of a trust - the sole activities of the trust are obtaining shares, or rights to acquire shares, and providing those shares or rights to employees of a company or to associates of those employees.

ex dividend has the meaning given by section 160APHE.

fixed trust has the same meaning as in Schedule 2F.

franked distribution has the meaning given by subsection 177EA(16).

interest , in relation to shares or other property, means any legal or equitable interest in the shares or other property.

materially diminish has the meaning given by section 160APHM.

non-fixed trust has the same meaning as in Schedule 2F.

position , in relation to shares or an interest in shares, has the meaning given by section 160APHJ as that meaning is affected by sections 160APHK and 160APHL.

preference shares in a company means shares in the company that:


(a) have a fixed dividend entitlement or, having regard to the terms of their issue, are likely to have a fixed dividend return; or


(b) having regard to the terms of their issue and other relevant matters, are less risky than ordinary shares in the company.

prescribed person , in relation to a unit trust, has the meaning given by section 160APHS.

primary qualification period , in relation to a taxpayer in relation to shares or an interest in shares, means the period beginning on the day after the day on which the taxpayer acquired the shares or interest and ending:


(a) if the shares are not preference shares - on the 45th day after the day on which the shares or interest became ex dividend; or


(b) if the shares are preference shares - on the 90th day after the day on which the shares or interest became ex dividend.

qualification period , in relation to a taxpayer in relation to shares or an interest in shares, means the primary qualification period or the secondary qualification period in relation to the taxpayer in relation to the shares or interest.

qualified person , in relation to a dividend paid on shares, has the meaning given by section 160APHO, 160APHP, 160APHQ, 160APHR or 160APHT as that meaning is affected by section 160APHU.

rebateable distribution means a distribution to which section 45Z applies and in respect of which the taxpayer is entitled to a rebate under section 46 or 46A.

rebateable dividend means a dividend for which the taxpayer is entitled to a rebate under section 46 or 46A.

related payment : the making of a related payment has a meaning affected by sections 160APHN and 160APHNA.

secondary qualification period , in relation to a taxpayer in relation to shares or an interest in shares, means:


(a) if the shares are not preference shares - the period beginning on the 45th day before, and ending on the 45th day after, the day on which the shares or interest became ex dividend; or


(b) if the shares are preference shares - the period beginning on the 90th day before, and ending on the 90th day after, the day on which the shares or interest become ex dividend.

share includes:


(a) the interest in a corporate limited partnership (within the meaning of Division 5A of Part III) that a partner in the partnership has; and


(b) if a company does not have a share capital - the interest in the company that a member has.

substantially identical securities has the meaning given by section 160APHF.

wholly-owned group : the question whether 2 or more companies are members of the same wholly-owned group is to be determined in the same way as under Subdivision 975-W of the Income Tax Assessment Act 1997.

widely held trust , at a particular time, means:


(a) a trust that, at that time, is neither a closely held fixed trust nor a non-fixed trust; or


(b) a trust the trustee of which is the subject of a declaration that is in force under regulations made for the purposes of paragraph 160APHR(1)(j); or


(c) a unit trust if, at that time:


(i) at least 75% of the units are held by a person who is, or persons each of whom is, a person referred to in any of paragraphs 160APHR(1)(a) to (j) or a prescribed person in relation to the trust; and

(ii) all of the units carry the same rights; and

(iii) if the units are redeemable, they are redeemable for a price determined on the basis of the trust's net asset value, according to Australian accounting principles; and

(iv) the trust engages only in qualifying activities within the meaning of subsection 160APHR(11).


 



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