Document ID: chunk:federal_register_of_legislation:C2004A00975:clause:1_3:p2
Version: federal_register_of_legislation:C2004A00975
Segment Type: clause
Provision Reference: sch 1 cl 3 (pt 2/11)
Character Range: 91186–93979

trust is a *resident unit trust for the income year in which that time occurs; and
 (e) in the case of a *public trading trust—the public trading trust is a resident unit trust for the income year in which that time occurs.

Subdivision 207‑D—Adjustments where the ultimate recipient of a distribution is not a resident

Guide to Subdivision 207‑D

207‑80  What this Subdivision is about

      Adjustments are made where a franked distribution flows indirectly to a non‑resident to ensure that the recipient is not taxed inappropriately.

Table of sections

207‑85 Adjustments where an entity to which a distribution flows indirectly is a non‑resident

Operative provisions

207‑90 Adjustment for non‑resident beneficiaries
207‑95 Adjustment where trustee assessed for non‑resident beneficiary
207‑100 Adjustment for non‑resident partners

207‑85  Adjustments where an entity to which a distribution flows indirectly is a non‑resident

 (1) Where a franked distribution flows indirectly to an entity who is not a resident, an amount of the distribution, worked out by applying the franking percentage for the distribution to the amount of the distribution that flows indirectly to the entity, is not included in the assessable income of the entity because of section 128D of the Income Tax Assessment Act 1936.

 (2) However, unless an adjustment were made, that entity's share of the franking credit on the distribution would be assessed.

 (3) Adjustments are therefore made under this Subdivision to ensure that this does not occur.

[This is the end of the Guide.]

Operative provisions

207‑90  Adjustment for non‑resident beneficiaries

  Where:
 (a) a *franked distribution *flows indirectly to an individual or a *corporate tax entity as beneficiary of a trust; and
 (b) the distribution does not flow indirectly to the entity as trustee of a trust; and
 (c) a share of the *net income of the trust is included in the assessable income of the entity, for the income year in which the distribution is made, under section 97, 98A or 100 of the Income Tax Assessment Act 1936; and
 (d) but for section 128D of that Act, that share would include income to which section 128B of that Act would apply but for paragraph 128B(3)(ga);
a deduction is allowed from the assessable income of the entity for that income year of an amount worked out under Subdivision 207‑J.

207‑95  Adjustment where trustee assessed for non‑resident beneficiary

  Where:
 (a) a *franked distribution *flows indirectly to the trustee of a trust; and
 (b) the trustee is liable to be assessed on a share of the *net income of the trust, for the income year in which the distribution is made, under section 98 of the Income Tax Assessment Act 1936; and
 (c) but for section 128D of that Act, that share would