Document ID: chunk:federal_register_of_legislation:C2025C00029:section:11:p21
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 11 (pt 21/64)
Character Range: 3346769–3349661

described in subsection (1); and
 (c) if the demutualisation method was the method specified in section 121AH, 121AI, 121AJ, 121AK or 121AL of the Income Tax Assessment Act 1936—all amounts that were previously transferred to the issuing company's share capital account, from another account of the issuing company, as described in subsection (1); and
 (d) all amounts that were previously transferred, in connection with the demutualisation, to the share capital account of the issuing company (within the meaning of section 197‑35) as described in subsection 197‑35(1), or to its retained profit account as described in paragraph 197‑35(2)(c);
exceeds the listing day company valuation amount (see subsection (3)), subsection (1) does not stop this Division from applying to so much of the transferred amount as equals the lesser of the transferred amount and the amount of the excess.
Note: If there are several transfers of amounts to the share capital account of the demutualised company or the issuing company, this section must be applied separately in relation to each transferred amount, in the order in which the transfers are made.
 (3) The listing day company valuation amount has the same meaning as it has for the purposes of table 1 in section 121AS of the Income Tax Assessment Act 1936, as that table applies in relation to the demutualised company (see note 3 to that table).

197‑42  Exclusion for exploration credits
  This Division does not apply to the transferred amount if:
 (a) the company transferring the amount is a *greenfields minerals explorer; and
 (b) the amount is transferred in connection with the creation of *exploration credits.

Subdivision 197‑B—Consequence of transfer: franking debit arises

Table of sections
197‑45 A franking debit arises in relation to the transfer

197‑45  A franking debit arises in relation to the transfer
 (1) A *franking debit arises in a company's *franking account if an amount (the transferred amount) to which this Division applies is transferred to the company's *share capital account. The debit arises immediately before the end of the *franking period in which the transfer of the amount occurs.
 (2) The amount of the *franking debit is calculated in accordance with the formula:
where:
applicable franking percentage means:
 (a) if, before the debit arises, the *benchmark franking percentage for the *franking period in which the transfer of the amount occurs has already been set by section 203‑30—that percentage; or
 (b) otherwise—100%.
applicable gross‑up rate means the company's *corporate tax gross‑up rate for the income year in which the franking debit arises.

Subdivision 197‑C—Consequence of transfer: tainting of share capital account

Table of sections
197‑50 The share capital account becomes tainted (if it is not already tainted)
197‑55 Choosing to untaint a tainted share capital account
197‑60