Document ID: chunk:federal_register_of_legislation:C2010C00605:clause:13_3:p5
Version: federal_register_of_legislation:C2010C00605
Segment Type: clause
Provision Reference: sch 13 cl 3 (pt 5/9)
Character Range: 210339–212991

actual costs incurred by an Australian permanent establishment while it is treated as part of the head company because of this section.

820‑605  Effect on foreign bank if certain debt deductions disallowed

  If:
 (a) apart from this Division, a *debt deduction would be a deduction of the *foreign bank for an income year; and
 (b) this Division (as applying because of this Subdivision) disallows all or part of the deduction (treated as a deduction of the *head company or single company);
this section disallows the deduction of the foreign bank, or that part of it, as appropriate.

Note 1: This Division does not disallow a debt deduction that the foreign bank incurs during the grouping period and that consists of a cost that is:
  *   attributable to an Australian permanent establishment covered by the choice under section 820‑597 or 820‑599; and
  *   paid or owed to the head company or single company.

 The cost is not a debt deduction of the head company or single company for the purposes of this Division as applying because of this Subdivision. This is because subsection 820‑603(3) or (4) treats the Australian permanent establishment as being part of the head company or single company, so the cost is treated as being paid or owed by the head company or single company to itself.

 Because subsection 820‑603(3) or (4) also treats the Australian permanent establishment as not being part of the foreign bank, the cost is not a debt deduction of the foreign bank, so it is not disallowed by this Division as applying to the foreign bank.

Note 2: This Division also does not disallow a debt deduction that the head company or single company incurs during the grouping period and that consists of a cost that is:
  *   paid or owed to the foreign bank; and
  *   is attributable to an Australian permanent establishment covered by the choice under section 820‑597 or 820‑599.

 The cost is not a debt deduction of the head company or single company for the purposes of this Division as applying because of this Subdivision. This is because subsection 820‑603(3) or (4) treats the Australian permanent establishment as being part of the head company or single company, so the cost is treated as being paid or owed by the head company or single company to itself.

820‑607  Effect on test periods under this Division

  If, apart from this section, this Division (except this Subdivision) would have a single application to the *head company or single company, or to the *foreign bank, in relation to a period (the test period) that:
 (a) is all or part of an income year of that entity; and
 (b) overlaps the grouping period;
this