INCOME TAX ASSESSMENT ACT 1997 - SECT 820.330 Application to part year periods

Commonwealth Consolidated Acts

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INCOME TAX ASSESSMENT ACT 1997 - SECT 820.330

Application to part year periods

(1) This subsection disallows all or a part of each * debt deduction of an entity for an income year that is an amount incurred by the entity during a period that is a part of that year (to the extent that it is not attributable to an * overseas permanent establishment of the entity) if, for that period:

(a) the entity is an * outward investing entity (ADI); and

(b) the * adjusted average equity capital of the entity is less than the entity's * minimum capital amount.

Note: To determine whether an entity is an outward investing entity (non - ADI) for that period, see subsection 820 - 300(2).

(2) The entity's adjusted average equity capital for that period is:

(a) the average value, for that period, of all the * ADI equity capital of the entity (other than ADI equity capital attributable to any of its * overseas permanent establishments); minus

(b) the average value, for that period, of all the * controlled foreign entity equity of the entity (other than controlled foreign entity equity attributable to any of its overseas permanent establishments).

(3) For the purposes of determining:

(a) the entity's * minimum capital amount for that period; and

(b) the amount of each * debt deduction to be disallowed;

sections 820 - 305 to 820 - 325 apply in relation to that entity and that period with the modifications set out in the following table:

Modifications of sections 820 - 305 to 820 - 325
Item
Provisions
Modifications
1
Sections 820 - 305 to 820 - 325
A reference to an income year is taken to be a reference to that period
2
Section 820 - 325
A reference to subsection 820 - 300(1) is taken to be a reference to subsection (1) of this section
3
Section 820 - 325
adjusted average equity capital has the meaning given by subsection (2) of this section
average debt is taken to be the average value, for that period, of all the * debt capital of the entity that gives rise to * debt deductions of the entity for that or any other income year, to the extent that the debt capital is not attributable to any of the entity's * overseas permanent establishments

Modifications of sections 820 - 305 to 820 - 325
1	Sections 820 - 305 to 820 - 325	A reference to an income year is taken to be a reference to that period
2	Section 820 - 325	A reference to subsection 820 - 300(1) is taken to be a reference to subsection (1) of this section
3	Section 820 - 325	adjusted average equity capital has the meaning given by subsection (2) of this section average debt is taken to be the average value, for that period, of all the * debt capital of the entity that gives rise to * debt deductions of the entity for that or any other income year, to the extent that the debt capital is not attributable to any of the entity's * overseas permanent establishments

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Modifications of sections 820 - 305 to 820 - 325
Item	Provisions	Modifications
1	Sections 820 - 305 to 820 - 325	A reference to an income year is taken to be a reference to that period
2	Section 820 - 325	A reference to subsection 820 - 300(1) is taken to be a reference to subsection (1) of this section
3	Section 820 - 325	adjusted average equity capital has the meaning given by subsection (2) of this section average debt is taken to be the average value, for that period, of all the * debt capital of the entity that gives rise to * debt deductions of the entity for that or any other income year, to the extent that the debt capital is not attributable to any of the entity's * overseas permanent establishments