Product Ruling PR 2023/16
Date of effect: 1 July 2023

What this ruling is about: 1. This Ruling sets out the income tax consequences for entities that participate as an investor in CHESS depositary interests (CDIs) over units in the SPDR ® S&P 500 ® ETF Trust (the Fund), offered under a Product Disclosure Statement (PDS) issued by State Street Global Advisors Trust Company as the trustee of the Fund (the Trustee) and State Street Global Advisors, Australia Services Limited (the AQUA Product Issuer). 2. All legislative references in this Ruling are to the Income Tax Assessment Act 1997, unless otherwise indicated. Terms which are defined in the PDS referred to in paragraph 11 of this Ruling have been capitalised. 3. This Ruling does not address: Who this Ruling applies to 4. This Ruling applies to you if you: 5. This Ruling does not apply to you if you: Requirements of the Superannuation Industry (Supervision) Act 1993 6. This Ruling does not address the provisions of the Superannuation Industry (Supervision) Act 1993. The Commissioner gives no assurance that the Scheme is an appropriate investment for a superannuation fund. The trustees of superannuation funds are advised that no consideration has been given in this Ruling as to whether investment in this Scheme may contravene the provisions of the Superannuation Industry (Supervision) Act 1993. 7. This Ruling applies from 1 July 2023 to investors specified in paragraph 4 of this Ruling who enter into the scheme described in paragraphs 11 to 24 of this Ruling from 1 July 2023 until 30 June 2026. 8. However, the Ruling only applies and may be relied on to the extent that there is no change in the scheme or in the investor's involvement in the scheme. If the scheme carried out is materially different from the scheme described at paragraphs 11 to 24 of this Ruling, this Ruling cannot be relied upon and may be withdrawn or modified. 9. Subject to paragraph 3 of this Ruling and the assumptions in paragraph 10 of this Ruling: Assumptions 10. This Ruling is made on the basis of the following necessary assumptions: 11. The scheme is identified and described in the following: Note: Certain information has been provided on a commercial-in-confidence basis and will not be disclosed or released under Freedom of Information legislation. 12. For the purposes of describing the Scheme, there are no other agreements (whether formal or informal, and whether or not legally enforceable) which an investor, or any associate of investor, will be a party to which are a part of the Scheme. 13. All Australian Securities and Investments Commission requirements are, or will be, complied with for the term of the agreements. Overview of scheme 14. The AQUA Product Issuer and Trustee receive offers for units in the Fund from investors through an Authorised Participant and a PDS issued by the AQUA Product Issuer and the Trustee. 15. The Fund is: 16. The Fund has been cross-listed on the AQUA market of the ASX. The cross-listing has been implemented by the creation of CDIs over units in the Fund which represent an undivided ownership interest in the portfolio of securities of the Fund. Such CDIs are quoted for trading under the AQUA rules (set out in Schedule 10A to the ASX Operating Rules). 17. Legal title in the cross-listed units in the Fund is held by the nominee of the US securities depositary for an Australian depositary nominee (the Depositary Nominee) or its custodian. 18. The Fund issues and redeems units at the net asset value per unit once each US business day. Only certain institutional investors (typically market makers or other broker-dealers) that are registered authorised participants in the US (US Authorised Participants) are permitted to purchase or redeem units directly with the Fund, and they may do so only in blocks of 50,000 units. 19. The CDIs are created by an approved Authorised Participant arranging for the relevant basket of Fund units to be transferred to the Depositary Nominee (or its custodian). 20. On receipt of the Fund units the Depositary Nominee issues corresponding CDIs to the relevant Authorised Participant. 21. Australian retail investors are only able to trade in CDIs on the secondary market (the AQUA market of the ASX). That is, there are no primary issues or redemptions of CDIs over units in the Fund to or by Australian retail investors. 22. CDIs are redeemed by the Depositary Nominee cancelling CDIs and transferring the corresponding Fund units to the relevant Authorised Participant (or their relevant Depositary Trust Company participant). 23. A CDI confers on its holder (the investor) a beneficial interest in a unit in the Fund, including the distributions on those units. Each CDI corresponds to a single Fund unit on a one-for-one basis. 24. Investors are entitled to receive an amount representing dividends accumulated under the Fund less fees, quarterly or monthly as determined by the Trustee and the Sponsor. Other income may be distributed annually as determined by the Trustee. Commissioner of Taxation 30 August 2023 Assessability of distributions to investors 25. CDIs provide a beneficial interest to the investor in the units in the Fund. Each CDI gives rise to a separate trust estate. Distributions from the Fund will represent income of each trust estate represented by a CDI and will be assessable to the investor under section 97 of the ITAA 1936. 26. Distributions from the Fund will be treated as dividends as the Fund is treated as a company for US federal income tax purposes. 27. According to the double-tax treaty between Australia and the US (US Convention [1] ) an entity will satisfy the definition of a company if the entity is treated as a company or body corporate for tax purposes. 28. Further, Article 10(6) of the US Convention defines the term 'dividend' to mean: 29. Therefore, any distributions made by the Fund flowing to the Depositary Nominee will be treated as distributions made by a company and will have the same character as dividends. Accordingly, distributions from the Fund will be treated as dividends which will comprise the net income of each trust estate relating to the CDIs and will be assessable to the investor as the holder of those CDIs under section 97 of the ITAA 1936. Application of capital gains tax provisions on disposal of CHESS depositary interests Section 108-5  CGT asset 30. Under subsection 108-5(1) a CGT asset is any kind of property, or a legal or equitable right that is not property. A CDI is a CGT asset under subsection 108-5(1). Section 104-10  CGT event A1 31. The disposal of the CDIs by the investor gives rise to a CGT event A1 in respect of the investor (section 104-10). The investor will make a capital gain from this CGT event if the capital proceeds from the disposal of the CDIs are more than the CDIs' cost base or, alternatively, a capital loss from this CGT event if those capital proceeds are less than the CDIs' reduced cost base (subsection 104-10(4)). 32. The investor's capital proceeds under section 116-20 will be the amount they receive from the disposal of the CDIs on the AQUA market. 33. The cost base or the reduced cost base of the investor's CDIs will be the acquisition cost of the CDIs plus any incidental costs incurred by the investor in acquiring the CDIs (sections 110-25 and 110-55). The cost base or the reduced cost base of the investor's CDIs will be reduced by the amount of any distribution to the extent it is not treated as a dividend for US federal income tax purposes. If those distributions exceed the investor's existing cost base in their CDIs, a capital gain equal to the excess will arise. Section 115-5  discount capital gains 34. Division 115 allows a taxpayer a discount on capital gains in certain circumstances. In accordance with section 115-5, any capital gain realised by the investor as a result of the disposal of the CDIs will be treated as a discount capital gain where the investor has held those CDIs for at least 12 months (excluding the days of acquisition and disposal). 35. To be a discount capital gain the capital gain must be made by an investor that is either an individual, a complying superannuation entity, or a trust (section 115-10). Division 770  foreign income tax offset 36. Division 770 allows a non-refundable tax offset for an income year for foreign income tax paid where that amount of foreign income tax is paid in respect of an amount that is included in your assessable income for the year. 37. To the extent that the investor has paid, or is deemed to have paid, foreign income tax (such as withholding tax at source): Subsection 159GP(1) of the ITAA 1936  qualifying security 38. A 'qualifying security' is defined in subsection 159GP(1) of the ITAA 1936. For the purposes of determining whether an arrangement is a qualifying security, that arrangement must be a 'security', also defined in subsection 159GP(1) of the ITAA 1936 to mean: 39. CDIs acquired by the investor do not fall within paragraphs (a), (b), (c) or (d) of the definition of security in subsection 159GP(1) of the ITAA 1936. Therefore, the CDIs are not qualifying securities under subsection 159GP(1) of the ITAA 1936. Division 230  taxation of financial arrangements 40. Division 230 sets out the tax treatment of gains or losses from a 'financial arrangement'. 41. Where an arrangement is not a qualifying security for the purposes of Division 16E of the ITAA 1936 and an election under section 230-455 to have Division 230 apply to financial arrangements has not been made, then pursuant to section 230-455, Division 230 does not apply in relation to gains or losses from a financial arrangement held by: © AUSTRALIAN TAXATION OFFICE FOR THE COMMONWEALTH OF AUSTRALIA You are free to copy, adapt, modify, transmit and distribute this material as you wish (but not in any way that suggests the ATO or the Commonwealth endorses you or any of your services or products).

Class of entities or scheme: 14. The AQUA Product Issuer and Trustee receive offers for units in the Fund from investors through an Authorised Participant and a PDS issued by the AQUA Product Issuer and the Trustee. 15. The Fund is: 16. The Fund has been cross-listed on the AQUA market of the ASX. The cross-listing has been implemented by the creation of CDIs over units in the Fund which represent an undivided ownership interest in the portfolio of securities of the Fund. Such CDIs are quoted for trading under the AQUA rules (set out in Schedule 10A to the ASX Operating Rules). 17. Legal title in the cross-listed units in the Fund is held by the nominee of the US securities depositary for an Australian depositary nominee (the Depositary Nominee) or its custodian. 18. The Fund issues and redeems units at the net asset value per unit once each US business day. Only certain institutional investors (typically market makers or other broker-dealers) that are registered authorised participants in the US (US Authorised Participants) are permitted to purchase or redeem units directly with the Fund, and they may do so only in blocks of 50,000 units. 19. The CDIs are created by an approved Authorised Participant arranging for the relevant basket of Fund units to be transferred to the Depositary Nominee (or its custodian). 20. On receipt of the Fund units the Depositary Nominee issues corresponding CDIs to the relevant Authorised Participant. 21. Australian retail investors are only able to trade in CDIs on the secondary market (the AQUA market of the ASX). That is, there are no primary issues or redemptions of CDIs over units in the Fund to or by Australian retail investors. 22. CDIs are redeemed by the Depositary Nominee cancelling CDIs and transferring the corresponding Fund units to the relevant Authorised Participant (or their relevant Depositary Trust Company participant). 23. A CDI confers on its holder (the investor) a beneficial interest in a unit in the Fund, including the distributions on those units. Each CDI corresponds to a single Fund unit on a one-for-one basis. 24. Investors are entitled to receive an amount representing dividends accumulated under the Fund less fees, quarterly or monthly as determined by the Trustee and the Sponsor. Other income may be distributed annually as determined by the Trustee. Commissioner of Taxation 30 August 2023 | Assessability of distributions to investors: 25. CDIs provide a beneficial interest to the investor in the units in the Fund. Each CDI gives rise to a separate trust estate. Distributions from the Fund will represent income of each trust estate represented by a CDI and will be assessable to the investor under section 97 of the ITAA 1936. 26. Distributions from the Fund will be treated as dividends as the Fund is treated as a company for US federal income tax purposes. 27. According to the double-tax treaty between Australia and the US (US Convention [1] ) an entity will satisfy the definition of a company if the entity is treated as a company or body corporate for tax purposes. 28. Further, Article 10(6) of the US Convention defines the term 'dividend' to mean: 29. Therefore, any distributions made by the Fund flowing to the Depositary Nominee will be treated as distributions made by a company and will have the same character as dividends. Accordingly, distributions from the Fund will be treated as dividends which will comprise the net income of each trust estate relating to the CDIs and will be assessable to the investor as the holder of those CDIs under section 97 of the ITAA 1936. | Section 108-5  CGT asset: 30. Under subsection 108-5(1) a CGT asset is any kind of property, or a legal or equitable right that is not property. A CDI is a CGT asset under subsection 108-5(1). | Section 104-10  CGT event A1: 31. The disposal of the CDIs by the investor gives rise to a CGT event A1 in respect of the investor (section 104-10). The investor will make a capital gain from this CGT event if the capital proceeds from the disposal of the CDIs are more than the CDIs' cost base or, alternatively, a capital loss from this CGT event if those capital proceeds are less than the CDIs' reduced cost base (subsection 104-10(4)). 32. The investor's capital proceeds under section 116-20 will be the amount they receive from the disposal of the CDIs on the AQUA market. 33. The cost base or the reduced cost base of the investor's CDIs will be the acquisition cost of the CDIs plus any incidental costs incurred by the investor in acquiring the CDIs (sections 110-25 and 110-55). The cost base or the reduced cost base of the investor's CDIs will be reduced by the amount of any distribution to the extent it is not treated as a dividend for US federal income tax purposes. If those distributions exceed the investor's existing cost base in their CDIs, a capital gain equal to the excess will arise. | Section 115-5  discount capital gains: 34. Division 115 allows a taxpayer a discount on capital gains in certain circumstances. In accordance with section 115-5, any capital gain realised by the investor as a result of the disposal of the CDIs will be treated as a discount capital gain where the investor has held those CDIs for at least 12 months (excluding the days of acquisition and disposal). 35. To be a discount capital gain the capital gain must be made by an investor that is either an individual, a complying superannuation entity, or a trust (section 115-10). | Division 770  foreign income tax offset: 36. Division 770 allows a non-refundable tax offset for an income year for foreign income tax paid where that amount of foreign income tax is paid in respect of an amount that is included in your assessable income for the year. 37. To the extent that the investor has paid, or is deemed to have paid, foreign income tax (such as withholding tax at source): | Subsection 159GP(1) of the ITAA 1936  qualifying security: 38. A 'qualifying security' is defined in subsection 159GP(1) of the ITAA 1936. For the purposes of determining whether an arrangement is a qualifying security, that arrangement must be a 'security', also defined in subsection 159GP(1) of the ITAA 1936 to mean: 39. CDIs acquired by the investor do not fall within paragraphs (a), (b), (c) or (d) of the definition of security in subsection 159GP(1) of the ITAA 1936. Therefore, the CDIs are not qualifying securities under subsection 159GP(1) of the ITAA 1936. | Division 230  taxation of financial arrangements: 40. Division 230 sets out the tax treatment of gains or losses from a 'financial arrangement'. 41. Where an arrangement is not a qualifying security for the purposes of Division 16E of the ITAA 1936 and an election under section 230-455 to have Division 230 apply to financial arrangements has not been made, then pursuant to section 230-455, Division 230 does not apply in relation to gains or losses from a financial arrangement held by: © AUSTRALIAN TAXATION OFFICE FOR THE COMMONWEALTH OF AUSTRALIA You are free to copy, adapt, modify, transmit and distribute this material as you wish (but not in any way that suggests the ATO or the Commonwealth endorses you or any of your services or products).

Ruling: 1. This Ruling sets out the income tax consequences for entities that participate as an investor in CHESS depositary interests (CDIs) over units in the SPDR ® S&P 500 ® ETF Trust (the Fund), offered under a Product Disclosure Statement (PDS) issued by State Street Global Advisors Trust Company as the trustee of the Fund (the Trustee) and State Street Global Advisors, Australia Services Limited (the AQUA Product Issuer). 2. All legislative references in this Ruling are to the Income Tax Assessment Act 1997, unless otherwise indicated. Terms which are defined in the PDS referred to in paragraph 11 of this Ruling have been capitalised. 3. This Ruling does not address: | Who this Ruling applies to: 4. This Ruling applies to you if you: 5. This Ruling does not apply to you if you: | Requirements of the Superannuation Industry (Supervision) Act 1993: 6. This Ruling does not address the provisions of the Superannuation Industry (Supervision) Act 1993. The Commissioner gives no assurance that the Scheme is an appropriate investment for a superannuation fund. The trustees of superannuation funds are advised that no consideration has been given in this Ruling as to whether investment in this Scheme may contravene the provisions of the Superannuation Industry (Supervision) Act 1993. 7. This Ruling applies from 1 July 2023 to investors specified in paragraph 4 of this Ruling who enter into the scheme described in paragraphs 11 to 24 of this Ruling from 1 July 2023 until 30 June 2026. 8. However, the Ruling only applies and may be relied on to the extent that there is no change in the scheme or in the investor's involvement in the scheme. If the scheme carried out is materially different from the scheme described at paragraphs 11 to 24 of this Ruling, this Ruling cannot be relied upon and may be withdrawn or modified. 9. Subject to paragraph 3 of this Ruling and the assumptions in paragraph 10 of this Ruling: | Assumptions: 10. This Ruling is made on the basis of the following necessary assumptions: 11. The scheme is identified and described in the following: Note: Certain information has been provided on a commercial-in-confidence basis and will not be disclosed or released under Freedom of Information legislation. 12. For the purposes of describing the Scheme, there are no other agreements (whether formal or informal, and whether or not legally enforceable) which an investor, or any associate of investor, will be a party to which are a part of the Scheme. 13. All Australian Securities and Investments Commission requirements are, or will be, complied with for the term of the agreements. | Overview of scheme: 14. The AQUA Product Issuer and Trustee receive offers for units in the Fund from investors through an Authorised Participant and a PDS issued by the AQUA Product Issuer and the Trustee. 15. The Fund is: 16. The Fund has been cross-listed on the AQUA market of the ASX. The cross-listing has been implemented by the creation of CDIs over units in the Fund which represent an undivided ownership interest in the portfolio of securities of the Fund. Such CDIs are quoted for trading under the AQUA rules (set out in Schedule 10A to the ASX Operating Rules). 17. Legal title in the cross-listed units in the Fund is held by the nominee of the US securities depositary for an Australian depositary nominee (the Depositary Nominee) or its custodian. 18. The Fund issues and redeems units at the net asset value per unit once each US business day. Only certain institutional investors (typically market makers or other broker-dealers) that are registered authorised participants in the US (US Authorised Participants) are permitted to purchase or redeem units directly with the Fund, and they may do so only in blocks of 50,000 units. 19. The CDIs are created by an approved Authorised Participant arranging for the relevant basket of Fund units to be transferred to the Depositary Nominee (or its custodian). 20. On receipt of the Fund units the Depositary Nominee issues corresponding CDIs to the relevant Authorised Participant. 21. Australian retail investors are only able to trade in CDIs on the secondary market (the AQUA market of the ASX). That is, there are no primary issues or redemptions of CDIs over units in the Fund to or by Australian retail investors. 22. CDIs are redeemed by the Depositary Nominee cancelling CDIs and transferring the corresponding Fund units to the relevant Authorised Participant (or their relevant Depositary Trust Company participant). 23. A CDI confers on its holder (the investor) a beneficial interest in a unit in the Fund, including the distributions on those units. Each CDI corresponds to a single Fund unit on a one-for-one basis. 24. Investors are entitled to receive an amount representing dividends accumulated under the Fund less fees, quarterly or monthly as determined by the Trustee and the Sponsor. Other income may be distributed annually as determined by the Trustee. Commissioner of Taxation 30 August 2023 | Assessability of distributions to investors: 25. CDIs provide a beneficial interest to the investor in the units in the Fund. Each CDI gives rise to a separate trust estate. Distributions from the Fund will represent income of each trust estate represented by a CDI and will be assessable to the investor under section 97 of the ITAA 1936. 26. Distributions from the Fund will be treated as dividends as the Fund is treated as a company for US federal income tax purposes. 27. According to the double-tax treaty between Australia and the US (US Convention [1] ) an entity will satisfy the definition of a company if the entity is treated as a company or body corporate for tax purposes. 28. Further, Article 10(6) of the US Convention defines the term 'dividend' to mean: 29. Therefore, any distributions made by the Fund flowing to the Depositary Nominee will be treated as distributions made by a company and will have the same character as dividends. Accordingly, distributions from the Fund will be treated as dividends which will comprise the net income of each trust estate relating to the CDIs and will be assessable to the investor as the holder of those CDIs under section 97 of the ITAA 1936. | Section 108-5  CGT asset: 30. Under subsection 108-5(1) a CGT asset is any kind of property, or a legal or equitable right that is not property. A CDI is a CGT asset under subsection 108-5(1). | Section 104-10  CGT event A1: 31. The disposal of the CDIs by the investor gives rise to a CGT event A1 in respect of the investor (section 104-10). The investor will make a capital gain from this CGT event if the capital proceeds from the disposal of the CDIs are more than the CDIs' cost base or, alternatively, a capital loss from this CGT event if those capital proceeds are less than the CDIs' reduced cost base (subsection 104-10(4)). 32. The investor's capital proceeds under section 116-20 will be the amount they receive from the disposal of the CDIs on the AQUA market. 33. The cost base or the reduced cost base of the investor's CDIs will be the acquisition cost of the CDIs plus any incidental costs incurred by the investor in acquiring the CDIs (sections 110-25 and 110-55). The cost base or the reduced cost base of the investor's CDIs will be reduced by the amount of any distribution to the extent it is not treated as a dividend for US federal income tax purposes. If those distributions exceed the investor's existing cost base in their CDIs, a capital gain equal to the excess will arise. | Section 115-5  discount capital gains: 34. Division 115 allows a taxpayer a discount on capital gains in certain circumstances. In accordance with section 115-5, any capital gain realised by the investor as a result of the disposal of the CDIs will be treated as a discount capital gain where the investor has held those CDIs for at least 12 months (excluding the days of acquisition and disposal). 35. To be a discount capital gain the capital gain must be made by an investor that is either an individual, a complying superannuation entity, or a trust (section 115-10). | Division 770  foreign income tax offset: 36. Division 770 allows a non-refundable tax offset for an income year for foreign income tax paid where that amount of foreign income tax is paid in respect of an amount that is included in your assessable income for the year. 37. To the extent that the investor has paid, or is deemed to have paid, foreign income tax (such as withholding tax at source): | Subsection 159GP(1) of the ITAA 1936  qualifying security: 38. A 'qualifying security' is defined in subsection 159GP(1) of the ITAA 1936. For the purposes of determining whether an arrangement is a qualifying security, that arrangement must be a 'security', also defined in subsection 159GP(1) of the ITAA 1936 to mean: 39. CDIs acquired by the investor do not fall within paragraphs (a), (b), (c) or (d) of the definition of security in subsection 159GP(1) of the ITAA 1936. Therefore, the CDIs are not qualifying securities under subsection 159GP(1) of the ITAA 1936. | Division 230  taxation of financial arrangements: 40. Division 230 sets out the tax treatment of gains or losses from a 'financial arrangement'. 41. Where an arrangement is not a qualifying security for the purposes of Division 16E of the ITAA 1936 and an election under section 230-455 to have Division 230 apply to financial arrangements has not been made, then pursuant to section 230-455, Division 230 does not apply in relation to gains or losses from a financial arrangement held by: © AUSTRALIAN TAXATION OFFICE FOR THE COMMONWEALTH OF AUSTRALIA You are free to copy, adapt, modify, transmit and distribute this material as you wish (but not in any way that suggests the ATO or the Commonwealth endorses you or any of your services or products).


Appendix: Assessability of distributions to investors: 25. CDIs provide a beneficial interest to the investor in the units in the Fund. Each CDI gives rise to a separate trust estate. Distributions from the Fund will represent income of each trust estate represented by a CDI and will be assessable to the investor under section 97 of the ITAA 1936. 26. Distributions from the Fund will be treated as dividends as the Fund is treated as a company for US federal income tax purposes. 27. According to the double-tax treaty between Australia and the US (US Convention [1] ) an entity will satisfy the definition of a company if the entity is treated as a company or body corporate for tax purposes. 28. Further, Article 10(6) of the US Convention defines the term 'dividend' to mean: 29. Therefore, any distributions made by the Fund flowing to the Depositary Nominee will be treated as distributions made by a company and will have the same character as dividends. Accordingly, distributions from the Fund will be treated as dividends which will comprise the net income of each trust estate relating to the CDIs and will be assessable to the investor as the holder of those CDIs under section 97 of the ITAA 1936. | Section 108-5  CGT asset: 30. Under subsection 108-5(1) a CGT asset is any kind of property, or a legal or equitable right that is not property. A CDI is a CGT asset under subsection 108-5(1). | Section 104-10  CGT event A1: 31. The disposal of the CDIs by the investor gives rise to a CGT event A1 in respect of the investor (section 104-10). The investor will make a capital gain from this CGT event if the capital proceeds from the disposal of the CDIs are more than the CDIs' cost base or, alternatively, a capital loss from this CGT event if those capital proceeds are less than the CDIs' reduced cost base (subsection 104-10(4)). 32. The investor's capital proceeds under section 116-20 will be the amount they receive from the disposal of the CDIs on the AQUA market. 33. The cost base or the reduced cost base of the investor's CDIs will be the acquisition cost of the CDIs plus any incidental costs incurred by the investor in acquiring the CDIs (sections 110-25 and 110-55). The cost base or the reduced cost base of the investor's CDIs will be reduced by the amount of any distribution to the extent it is not treated as a dividend for US federal income tax purposes. If those distributions exceed the investor's existing cost base in their CDIs, a capital gain equal to the excess will arise. | Section 115-5  discount capital gains: 34. Division 115 allows a taxpayer a discount on capital gains in certain circumstances. In accordance with section 115-5, any capital gain realised by the investor as a result of the disposal of the CDIs will be treated as a discount capital gain where the investor has held those CDIs for at least 12 months (excluding the days of acquisition and disposal). 35. To be a discount capital gain the capital gain must be made by an investor that is either an individual, a complying superannuation entity, or a trust (section 115-10). | Division 770  foreign income tax offset: 36. Division 770 allows a non-refundable tax offset for an income year for foreign income tax paid where that amount of foreign income tax is paid in respect of an amount that is included in your assessable income for the year. 37. To the extent that the investor has paid, or is deemed to have paid, foreign income tax (such as withholding tax at source): | Subsection 159GP(1) of the ITAA 1936  qualifying security: 38. A 'qualifying security' is defined in subsection 159GP(1) of the ITAA 1936. For the purposes of determining whether an arrangement is a qualifying security, that arrangement must be a 'security', also defined in subsection 159GP(1) of the ITAA 1936 to mean: 39. CDIs acquired by the investor do not fall within paragraphs (a), (b), (c) or (d) of the definition of security in subsection 159GP(1) of the ITAA 1936. Therefore, the CDIs are not qualifying securities under subsection 159GP(1) of the ITAA 1936. | Division 230  taxation of financial arrangements: 40. Division 230 sets out the tax treatment of gains or losses from a 'financial arrangement'. 41. Where an arrangement is not a qualifying security for the purposes of Division 16E of the ITAA 1936 and an election under section 230-455 to have Division 230 apply to financial arrangements has not been made, then pursuant to section 230-455, Division 230 does not apply in relation to gains or losses from a financial arrangement held by: © AUSTRALIAN TAXATION OFFICE FOR THE COMMONWEALTH OF AUSTRALIA You are free to copy, adapt, modify, transmit and distribute this material as you wish (but not in any way that suggests the ATO or the Commonwealth endorses you or any of your services or products).


What this Ruling is about | If this Ruling applies to you, and you correctly rely on it, we will apply the law to you in the way set out in this Ruling. That is, you will not pay any more tax or penalties or interest in respect of the matters covered by this Ruling. | This Ruling has been given on the basis that the entity who applied for the Ruling, and their associates, will abide by strict terms of use. Any failure to comply with the terms of use may lead to the withdrawal of this Ruling. | Potential participants must form their own view about the commercial and financial viability of the product. The Commissioner recommends a financial (or other) adviser be consulted for such information. | … income from shares, as well as other amounts which are subjected to the same taxation treatment as income from shares by the law of the State [in this case the US] of which the company making the distribution is a resident for the purposes of its tax. | (a) stock, a bond, debenture, certificate of entitlement, bill of exchange, promissory note or other security; | (b) a deposit with a bank or other financial institution; | (c) a secured or unsecured loan; or | (d) any other contract, whether or not in writing, under which a person is liable to pay an amount or amounts, whether or not the liability is secured.


Legislative references: ITAA 1936 97 ITAA 1936 Div 16E ITAA 1936 159GP(1) ITAA 1936 Pt IVA ITAA 1997 104-10 ITAA 1997 104-10(4) ITAA 1997 108-5 ITAA 1997 108-5(1) ITAA 1997 110-25 ITAA 1997 110-55 ITAA 1997 Div 115 ITAA 1997 115-5 ITAA 1997 115-10 ITAA 1997 116-20 ITAA 1997 Div 230 ITAA 1997 230-455 ITAA 1997 Div 770 ITAA 1997 770-15 ITAA 1997 770-75 ITAA 1997 770-130 ITAA 1997 770-140 SISA 1993 Investment Company Act 1940 (US)
Other references: Convention between the Government of Australia and the Government of the United States of America for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income [1983] ATS 16 ASX Operating Rules