Document ID: chunk:federal_register_of_legislation:C2024A00023:clause:2_76:p3
Version: federal_register_of_legislation:C2024A00023
Segment Type: clause
Provision Reference: sch 2 cl 76 (pt 3/12)
Character Range: 76609–79341

(b) the payer uses the financial arrangement to:
 (i) fund; or
 (ii) facilitate the funding of;
  one or more payments or distributions, of which one or more is a payment or distribution that, to an extent:
 (iii) the payer makes to an entity (an associate recipient) that is an *associate pair of the payer; and
 (iv) is covered by subsection (5A) (which is about types of payments or distributions);
 (c) the entity mentioned in subsection (1) (the relevant entity) is any of the following:
 (i) the payer;
 (ii) an associate pair of the payer;
 (iii) an associate pair of an associate recipient;
 (d) the relevant entity's *debt deduction mentioned in subsection (1) is, wholly or partly, in relation to the financial arrangement mentioned in paragraph (a) of this subsection;
 (e) the relevant entity's debt deduction is referable to an amount paid or payable, either directly or indirectly, to any of the following:
 (i) an associate pair of the relevant entity;
 (ii) an associate pair of the payer;
 (iii) an associate pair of an associate recipient;
 (f) the relevant entity has not made a choice under subsection 820‑46(4) to use the third party debt test for the income year mentioned in subsection (1) of this section.
 (5A) This subsection covers the following:
 (a) a *dividend, *distribution or *non‑share distribution;
 (b) a distribution by a trustee or partnership;
 (c) a return of capital, including a return of capital made by a distribution or payment made by a trustee or partnership;
 (d) a payment or distribution in respect of the cancellation or redemption of a *membership interest in an entity;
 (e) a *royalty, or a similar payment or distribution for the use of, or right to use, an asset;
 (f) a payment or distribution that is wholly or partly referable to the repayment of principal under a *debt interest if:
 (i) the debt interest is issued by the payer; and
 (ii) the debt interest is a *financial arrangement that satisfies paragraphs (5)(a), (b) and (c);
 (g) a payment or distribution of a kind similar to a payment or distribution mentioned in the preceding paragraphs;
 (h) a payment or distribution prescribed by the regulations.
 (6) For the purposes of paragraph (5)(b):
 (a) the payments or distributions mentioned in that paragraph may be made:
 (i) directly, or indirectly through one or more interposed entities (see subsection (7)); and
 (ii) before, at or after the time the payer enters into or has the *financial arrangement mentioned in paragraph (5)(a); and
 (b) a recipient may be the entity with whom the payer enters into or has the financial arrangement, or another entity.
 (7) For the purposes of subparagraph (6)(a)(i), in determining whether a payment or distribution is