Document ID: chunk:federal_register_of_legislation:C2010C00646:clause:4_10:p1
Version: federal_register_of_legislation:C2010C00646
Segment Type: clause
Provision Reference: sch 4 cl 10 (pt 1/4)
Character Range: 14793–17543

10  At the end of Division 115
Add:

Subdivision 115‑D—Tax relief for shareholders in listed investment companies

Guide to Subdivision 115‑D

115‑275  What this Subdivision is about

      This Subdivision allows shareholders of certain listed companies to obtain benefits similar to those conferred by discount capital gains.
      The benefits accrue where dividends paid by those companies represent capital gains that would be discount capital gains had they been made by an individual, a trust or a complying superannuation entity.

Table of sections

Operative provisions

115‑280 Deduction for certain dividends
115‑285 Meaning of LIC capital gain
115‑290 Meaning of listed investment company
115‑295 Maintaining records

[This is the end of the Guide.]

Operative provisions

115‑280  Deduction for certain dividends

 (1) You can deduct an amount for a *dividend paid to you by a company (the payment company) if:
 (a) you are:
 (i) an individual, a *complying superannuation entity, a trust or a partnership; or
 (ii) a *life insurance company where the dividend is in respect of *shares that are *virtual PST assets; and
 (b) you are an Australian resident when the dividend is paid; and
 (c) all or some part of the dividend is reasonably attributable to a *LIC capital gain made by a *listed investment company; and
 (d) in a case where the LIC capital gain was made by a company other than the payment company—the payment company was a listed investment company when it received a dividend part of which is attributable to the LIC capital gain.

Note: The concession is available for LIC capital gains made directly by a listed investment company, and for LIC capital gains that company receives as a dividend through one or more other listed investment companies.

 (2) The amount you can deduct is:
 (a) 50% of your share of the amount (the attributable part) worked out under subsection (3) if you are an individual, a trust (except a trust that is a *complying superannuation entity) or a partnership; or
 (b) 331/3% of your share of the attributable part if you are a complying superannuation entity or a *life insurance company.

Note 1: The listed investment company will advise you of your share of the attributable part.

Note 2: If a shareholder in a listed investment company is a trust or partnership, a beneficiary of the trust or a partner in the partnership has no share of the attributable part.

 (3) The attributable part is worked out using this formula:
where:

after tax gain is the after tax *LIC capital gain.

Example: A listed investment company disposes of a CGT asset for $30,000. The asset had a cost base of $10,000. The capital gain is therefore $20,000. The company applies a capital loss of $10,000