Commonwealth Consolidated Acts

INCOME TAX (TRANSITIONAL PROVISIONS) ACT 1997 - SECT 219.40

  (1)   This section applies if:

  (a)   a franking credit arose before 1   July 2002 in the franking account of a life insurance company under former section   160APVJ of the Income Tax Assessment Act 1936 in relation to a PAYG instalment in respect of an income year; and

  (b)   the company's assessment day (the assessment day ) for that income year occurs on or after 1   July 2002; and

  (c)   the company has a franking account (the new franking account ) under section   205 - 10 of the Income Tax Assessment Act 1997 .

  (2)   A franking debit of the amount worked out in accordance with the following formula is taken to have arisen in the new franking account on the assessment day:

where:

"amount of the 1936 Act credit" means the amount of the franking credit mentioned in paragraph   (1)(a).

  (3)   On the assessment day, a franking credit of the amount mentioned in item   2 of the table in section   219 - 15 of the Income Tax Assessment Act 1997 arises in the new franking account in relation to a payment of the PAYG instalment mentioned in paragraph   (1)(a) of this section that was made before 1   July 2002.

Note:   On the assessment day, the franking credit mentioned in paragraph   (1)(a) is therefore:

•    reversed by the franking debit arising under subsection   (2); and
•    replaced with a franking credit arising under subsection   (3).