Private ruling: off-market share buy-back
Published: January 2015

Ruling: Q1: Whether the Buy-Back and any subsequent cancellation of shares bought-back will be disregarded under section 159GZZZN of the Income Tax Assessment Act 1936 (ITAA 1936) for the purposes of determining whether: (a) an amount is included in the assessable income of Entity A; (b) an amount is allowable as a deduction to Entity A; and (c) Entity A makes a capital gain or capital loss. | A1: Yes. | Q2: Will the Dividend Component of the Buy-Back price be a frankable distribution pursuant to section 202-40 of the Income Tax Assessment Act 1997 (ITAA 1997) and, therefore, will be capable of being franked in accordance with section 202-5 of the ITAA 1997? | A2: Yes. | Q3: Will the Commissioner make a determination under paragraph 177EA(5)(a) of the ITAA 1936? | A3: Yes. | Q4: Will the Commissioner make a determination under paragraph 204-30(3)(a) of the ITAA 1997? | A4: No.




Subject: Proposed off-market share buy-back: The Commissioner issued a ruling in relation to a proposed off market share buy-back.