Taxation Determination TD 96/37







[Note: This is a consolidated version of this document. Refer to the Tax Office Legal Database (http://law.ato.gov.au) to check its currency and to view the details of all changes.]: 1. Section 456A of the Income Tax Assessment Act 1936 provides for a reduction of section 456 attributable income if foreign tax is payable under an accruals tax law of certain broad-exemption listed countries. The laws of a broad-exemption listed country that are declared to be an accruals tax law are set out in Income Tax Regulation 152HA. The test to determine whether the income has been accruals taxed in the broad-exemption listed country is set out in paragraph 456A(1)(c). | 2. Paragraph 456A(1)(c) provides that 'foreign tax is payable by the CFE under an accruals tax law of a broad-exemption listed country in respect of an amount that is calculated by reference to an item of net income or net profit of the CFC, where the amount is taxed in the broad-exemption listed country: | 3. The Commissioner considers that foreign tax is payable by a CFE under an accruals tax law of a broad-exemption listed country on an amount that is calculated by reference to an item of net income or net profit of the CFC within the meaning of section 456A: | 4. In relation to a particular type of entity, deductions referred to in paragraph 3 must be of the kind which are available, under the tax law of the broad-exemption listed country, to all other entities of that type that are subject to the tax jurisdiction of the broad-exemption listed country. For example, in the case of a company, deductions would include expenses incurred in deriving the particular amount, prior year carry forward losses, amortisation expenses and losses transferred within the company group. | 5. The Commissioner further considers that foreign tax is payable by a CFE under an accruals tax law of a broad-exemption listed country on an amount within the meaning of paragraph 456A(1)(c) where: | Note: The Addendum to this Determination that issued on 17 December 1997 amends the Determination, with effect for statutory accounting periods of controlled foreign companies commencing after 30 June 1997. | Commissioner of Taxation 18 September 1996 | Previously issued as Draft TD 93/D215


Legislative references: ITAA 456A ITR 152HA
Subject references: foreign source income