Private ruling: Capital Raising
Date of advice: 10 January 2019
Published: April 2019

Ruling: Q1: Will each Instrument be treated as a non-share equity interest (as defined in subsection 995-1(1) of the Income Tax Assessment Act 1997 (ITAA 1997)) in the Entity by virtue of the operation of Division 974 of the ITAA 1997? | A1: Yes. | Q2: Will the Distributions made by the Entity on Instrument be frankable non-share dividends within the meaning given by section 202-40 of the ITAA 1997? | A2: Yes. | Q3: Will section 204-15 of the ITAA 1997 apply to the Transaction? | A3: No. | Q4: Will section 204-30 of the ITAA 1997 apply to the Transaction? | A4: No. | Q5: Will section 177EA of the Income Tax Assessment Act 1936 (ITAA 1936) apply to the Transaction? | A5: No. | Q6: Will the Commissioner of Taxation make a determination under subsection 45C(3) of the ITAA 1936 in relation to the Transaction? | A6: No. | Q7: Is the Instrument subject to the commercial debt forgiveness provisions in Division 245 of the ITAA 1997? | A7: No. | Q8: Will the issue of the Instrument, the issue of Ordinary Shares on Exchange or the repayment of Face Value upon Early Redemption result in the Entity being subject to an assessable profit or gain under sections 6-5 or 6-10 of the ITAA 1997? | A8: No. | Q9: Will the Entity be required to recognise gains or losses under Division 230 of the ITAA 1997 in relation to the Instrument? | A9: No. | Q10: Will the share capital account of the Entity become tainted, within the meaning of Division 197 of the ITAA 1997, by an issue of the Instruments or Ordinary Shares on Exchange? | A10: No.




Subject: Capital Raising: The Commissioner was asked ten questions relating to the proposed PERLS XI Capital Raising transaction. | The Commissioner has ruled on each of the questions.