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INCOME TAX ASSESSMENT ACT 1997 - SECT 210.20

Limits on venture capital franking

             (1)  The venture capital credit on a distribution cannot exceed the franking credit on the distribution. It is, in this sense, a species of franking credit.

             (2)  A PDF can only distribute venture capital credits if it does it so that all members of the PDF receive venture capital credits in proportion to their holdings.

             (3)  If a PDF has a venture capital surplus when it makes a distribution, it must frank the distribution with venture capital credits.

             (4)  There are measures to ensure that a PDF does not maintain a venture capital deficit over a prolonged period.

Guide to Subdivision 210-A



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