(1) So much of the * unfranked part of a * frankable distribution made by an * Australian corporate tax entity that the entity declares, in its * distribution statement, to be * conduit foreign income:
(a) is not assessable income and is not * exempt income of a foreign resident; and
(b) is an amount to which section 128B (Liability to withholding tax) of the Income Tax Assessment Act 1936 does not apply.
(2) The declaration must be made on or before the day on which the * distribution is made.
Note: For a private company, this rule may bring forward the time at which the company is required to make its distribution statement: see section 202-75.