Document ID: chunk:federal_register_of_legislation:C2024A00023:clause:2_29:p13
Version: federal_register_of_legislation:C2024A00023
Segment Type: clause
Provision Reference: sch 2 cl 29 (pt 13/15)
Character Range: 46866–49629

applied against the excess mentioned in paragraph (1)(b).

820‑57  Meaning of FRT disallowed amount
  An entity has a fixed ratio test disallowed amount (or FRT disallowed amount) for an income year equal to:
 (a) if *debt deductions of the entity for the income year are disallowed under subsection 820‑46(1) and the amount disallowed is worked out in accordance with paragraph 820‑50(1)(a) (fixed ratio test applies)—the amount disallowed; or
 (b) otherwise—zero.

820‑58  FRT disallowed amount is treated as zero where subsequent choice means fixed ratio test does not apply
 (1) Subsection (2) applies if:
 (a) an entity has not made a choice under subsection 820‑46(3) or (4) in relation to an income year; and
 (b) the entity makes a choice under subsection 820‑46(3) or (4) in relation to a subsequent income year.
 (2) Despite section 820‑57, for the purpose of applying section 820‑56 in respect of that subsequent income year and later income years, treat the entity as having a *FRT disallowed amount of zero for every income year before that subsequent income year.

820‑59  When FRT disallowed amount is treated as zero for companies and trusts
 (1) This section applies if an entity is a company or a trust.
 (2) This section applies for the purposes of applying a *FRT disallowed amount of the entity for an income year (the disallowance year) under paragraph 820‑56(2)(b), in order to work out the amount of a deduction from its assessable income for another income year (the deduction year) under subsection 820‑56(1).
 (3) Despite section 820‑57, treat the *FRT disallowed amount for the disallowance year as being zero unless:
 (a) if the entity is a company—subsection (4) applies; or
 (b) if the entity is a trust—subsection (5) applies.

Rules for companies
 (4) This subsection applies if, assuming that:
 (a) the *FRT disallowed amount were a *tax loss; and
 (b) the disallowance year were the *loss year; and
 (c) the following provisions were disregarded:
 (i) subsection 165‑115B(3);
 (ii) subsection 165‑115BA(5);
 (iii) section 415‑35;
Divisions 165, 166 and 167 would not prevent the company from deducting the entire amount of that tax loss in the deduction year.

Rules for trusts
 (5) This subsection applies if, assuming that:
 (a) the *FRT disallowed amount were a tax loss (within the meaning of Schedule 2F to the Income Tax Assessment Act 1936); and
 (b) the disallowance year were a loss year (within the meaning of that Schedule);
that Schedule would not prevent the entity from deducting the entire amount of that tax loss in the deduction year.

820‑60  Excess tax EBITDA amount

Scope
 (1) This section applies to an entity (the controlling entity) if:
 (a) the controlling entity is, for a period that is all or part of