Private ruling: Division 820 - Thin Capitalisation
Published: October 2013

Ruling: The ruling concerned the following: | 1. For the purposes of the definition of 'average Australian assets' in subsection 820-37(1) of the Income Tax Assessment Act 1997 (ITAA 1997), is substantial equipment attributable to overseas permanent establishments of the Company? | 2. If the answer to Question 1 is yes, will the Company need to apportion the value of the substantial equipment that is attributable to overseas permanent establishments for the purposes of determining the 'average Australian assets' in paragraph 820-37(1)(c) of the ITAA 1997? | Decision | The Commissioner ruled that: | 1 Yes. The substantial equipment is attributable to overseas permanent establishments of the Company for the purposes of the definition of 'average Australian assets' in subsection 820-37(1) of the ITAA 1997. | 2 Yes. The Company will need to apportion the value of the substantial equipment that is attributable to overseas permanent establishments for the purposes of determining the 'average Australian assets' in paragraph 820-37(1)(c) of the ITAA 1997.