Document ID: chunk:federal_register_of_legislation:C2025C00029:section:5:p6
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 5 (pt 6/38)
Character Range: 7393295–7396185

is included in the assessable income of an entity under a provision of this Division in relation to a payment.
 (2) An amount in relation to the payment that is to be included in the assessable income of the entity under a provision (other than a provision of this Division) is to be reduced to the extent (if any) necessary to ensure that the total amount included in the entity's assessable income in relation to the payment does not exceed the amount of the payment.

Relationship with section 230‑20
 (3) This section applies despite section 230‑20 (about taxation of financial arrangements).

832‑50  Relationship between this Division and Division 820
 (1) In determining for the purposes of this Division whether a payment gives rise to a deduction, and the amount of the deduction, disregard the effect of Division 820 (about thin capitalisation).
 (2) Nothing in this Division limits Division 820 (about thin capitalisation) in its application to reduce, or further reduce, *debt deductions of an entity.

832‑55  Division does not affect foreign residence rules
  Nothing in this Division affects the operation of the provisions of Division 6 that provide for the significance of foreign residence for the assessability of ordinary and statutory income.
Note: Amounts included in assessable income under this Division may be ordinary or statutory income for the purposes of Division 6.

832‑60  Valuation of trading stock affected by hybrid mismatch rules
  If:
 (a) an amount of a deduction for an outgoing is disallowed under this Division; and
 (b) the outgoing was incurred in connection with acquiring an item of *trading stock; and
 (c) the item is on hand at the end of an income year;
the amount disallowed is to be disregarded in working out the *cost, market selling value or replacement value of the item at the end of the income year under section 70‑45.

Subdivision 832‑B—Concepts relating to mismatches

Guide to Subdivision 832‑B

832‑100  What this Subdivision is about
      This Subdivision sets out rules about identifying deduction/non‑inclusion mismatches and deduction/deduction mismatches.

Table of sections

Operative provisions
832‑105 When a payment gives rise to a deduction/non‑inclusion mismatch
832‑110 When a payment gives rise to a deduction/deduction mismatch
832‑115 Disregard effect of Division in determining deductions
832‑120 Meaning of foreign income tax deduction
832‑125 Meaning of subject to Australian income tax
832‑130 Meaning of subject to foreign income tax
832‑135 Safe harbour for translation rates

Operative provisions

832‑105  When a payment gives rise to a deduction/non‑inclusion mismatch

Australian deduction
 (1) If:
 (a) a deduction (other than a deduction that is solely attributable to a *currency exchange rate effect) is allowable to an entity in an income year in respect of a payment (including a part or share of