Public advice and guidance compendium TD 2017/21EC







This edited version of the Compendium of Comments is not intended to be relied upon. It provides no protection from primary tax, penalties, interest or sanctions for non-compliance with the law. | This is a compendium of responses to the issues raised by external parties to draft Taxation Determination TD 2016/D6 Income tax: where an Australian corporate tax entity is a partner in a partnership, can the partnership 'hold' a direct control interest (within the meaning of section 350 of the Income Tax Assessment Act 1936) in a foreign company for the purpose of Subdivision 768-A of the Income Tax Assessment Act 1997. | This compendium of comments has been edited to maintain the anonymity of entities that have commented. | Tax Office Response/Action taken | The interpretation and approach adopted in the draft Taxation Determination is appropriate. | The test time for determining whether there is a participation interest should be highlighted in the draft Taxation Determination. | The relevant test time is set out in the Example (see paragraph 10) and in the Explanation section (see paragraph 20). | It would also be desirable to briefly highlight that the effective dates for determining whether there is a participation interest in respect of indirect holdings is different for holdings through partnerships and trusts. | The reader is directed to the relevant guidance where the interposed entity is a trust rather than a partnership. | The draft Taxation Determination should clarify the meaning of 'partnership' and that it covers the tax law definition of partnership in section 995-1 of the ITAA 1997. | The meaning of partnership has been clarified in footnote 2 which also explains that the Determination does not cover situations where the interposed entity is a corporate limited partnership (see also footnote 6). | The decision to make the Determination retrospective from the date that Subdivision 768-A commenced (distributions made on or after 17 October 2014) should be appropriate in most cases.