Document ID: chunk:federal_register_of_legislation:C2025C00014:section:327b:p2
Version: federal_register_of_legislation:C2025C00014
Segment Type: section
Provision Reference: s 327B (pt 2/3)
Character Range: 1882327–1884997

at the time the dividends were paid;
 (iv) the total amount of dividends paid in respect of the widely distributed finance shares during the 12‑month period ending at the test time is equal to, or approximately equal to, the total amount of interest to which the dividends are attributable.

Meaning of finance shares
 (2) For the purposes of this section, shares in a company are finance shares if, and only if, having regard to:
 (a) the manner in which the amount of dividends in respect of the shares was to be calculated; and
 (b) the conditions applicable to the payment of dividends in respect of the shares; and
 (c) any other relevant matters;
the payment of the dividends in respect of the shares may reasonably be regarded as equivalent to the payment of interest on a loan.

Modification of widely distributed finance shares
 (3) For the purposes of this section, in determining whether shares are widely distributed finance shares, if an asset is held by an entity as trustee for another entity who is absolutely entitled to the asset against the trustee, paragraph 327A(2)(b) has effect as if:
 (a) the asset were vested in the other entity instead of the trustee; and
 (b) if the asset is a share—any dividends paid in respect of the share were paid to the other entity instead of to the trustee.

Meaning of under common ownership
 (4) For the purposes of this section, 2 companies are under common ownership at a particular time if, and only if:
 (a) another company (in this subsection called the third company) holds eligible share interests in each of the companies; and
 (b) the aggregate of the eligible share interests in each company held by the third company is 90% or more.

Meaning of eligible share interest
 (5) For the purposes of this section, a person holds an eligible share interest in a company at a particular time equal to the percentage of the company's total paid‑up share capital (excluding finance shares) beneficially owned by the person at that time.

Extended meaning of eligible share interest: tiers of companies
 (6) For the purposes of this section, if:
 (a) a person holds an eligible share interest (including an eligible share interest that is taken to be held because of one or more previous applications of this subsection) in a company (in this subsection called the first level company); and
 (b) the first level company holds an eligible share interest in another company (in this subsection called the second level company);
the person is taken to hold an eligible share interest in the second level company equal to the percentage calculated using the formula:

where:
First level percentage means the percentage