Document ID: chunk:federal_register_of_legislation:C2025C00014:section:128b:p6
Version: federal_register_of_legislation:C2025C00014
Segment Type: section
Provision Reference: s 128B (pt 6/10)
Character Range: 1251929–1254651

(3CB) For the purposes of subsection (3CA), the test entity is:
 (a) unless paragraph (b) applies—the entity that paid the interest, dividends or non‑share dividends as mentioned in subparagraph (3)(jb)(ii); or
 (b) if subsection 128A(3) applies in relation to a resident trust estate (within the meaning of Division 6)—the trust estate.
 (3CC) A superannuation fund satisfies the portfolio interest test in this subsection in relation to the test entity at a time if, at that time, the total participation interest (within the meaning of the Income Tax Assessment Act 1997) the superannuation fund holds in the test entity:
 (a) is less than 10%; and
 (b) would be less than 10% if, in working out the direct participation interest (within the meaning of that Act) that any entity holds in a company:
 (i) an equity holder were treated as a shareholder; and
 (ii) the total amount contributed to the company in respect of non‑share equity interests were included in the total paid‑up share capital of the company.
 (3CD) A superannuation fund has influence of a kind described in this subsection in relation to the test entity at a time if any of the following requirements are satisfied at that time:
 (a) the superannuation fund:
 (i) is directly or indirectly able to determine; or
 (ii) in acting in concert with others, is directly or indirectly able to determine;
  the identity of at least one of the persons who, individually or together with others, make (or might reasonably be expected to make) the decisions that comprise the control and direction of the test entity's operations;
 (b) at least one of those persons is accustomed or obliged to act, or might reasonably be expected to act, in accordance with the directions, instructions or wishes of the superannuation fund (whether those directions, instructions or wishes are expressed directly or indirectly, or through the superannuation fund acting in concert with others).
 (3CE) However, a superannuation fund does not have influence of a kind described in subsection (3CD) if, disregarding any breach of terms of a debt interest by any entity, the superannuation fund would not have influence of that kind.
 (3D) This section does not apply to a demerger dividend to which section 45B does not apply.
 (3E) This section does not apply to income that consists of a dividend that:
 (a) is paid to a person who is a non‑resident carrying on business in Australia at or through a permanent establishment of the person in Australia; and
 (b) is attributable to the permanent establishment; and
 (c) is not paid to the person in the person's capacity as trustee.
Note: This subsection not only ensures that this section does not apply to that income to make