Document ID: chunk:federal_register_of_legislation:C2014C00749:clause:13_10:p1
Version: federal_register_of_legislation:C2014C00749
Segment Type: clause
Provision Reference: sch 13 cl 10 (pt 1/3)
Character Range: 163836–167144

10                                                                                            a *former exempting entity becomes an *exempting entity; and                                                                                                                                                                                                              an amount equal to the *exempting surplus                                                                                            immediately after it becomes an exempting entity
                                                                                              the entity has an *exempting surplus at the time it becomes an *exempting entity

Note: Item 9 is designed to reverse out franking debits that arise in relation to a period during which the entity is an exempting entity. The entity will receive an exempting debit instead.

208‑135  Relationships that will give rise to a franking credit under item 5 of the table in section 208‑130
 (1) A relationship between an entity making a *franked distribution and the recipient of the distribution is of a type that gives rise to a *franking credit under item 5 or 6 of the table in section 208‑130 if either:
 (a) both entities are members of the same effectively wholly‑owned group; or
 (b) the recipient holds more than 5% of the *membership interests in the entity making the distribution (other than finance membership interests or distribution access membership interests within the meaning of section 208‑30 or membership interests that do not carry the right to receive distributions) and it would be reasonable to conclude that the risks involved in, and the opportunities resulting from, holding those membership interests are substantially borne by, or substantially accrue to, the recipient.
 (2) In deciding whether it would be reasonable to make the conclusion mentioned in paragraph (1)(b):
 (a) have regard to any *arrangement in respect of the *membership interests (including unissued membership interests) in the entity making the distribution (including derivatives held or issued in connection with those membership interests); and
 (b) do not have regard to risks involved in the ownership of membership interests in the entity making the distribution that are substantially borne by any person in the person's capacity as a secured creditor.

208‑140  Membership of the same effectively wholly‑owned group
 (1) Two *corporate tax entities are members of the same effectively wholly‑owned group of entities on a particular day if:
 (a) throughout that day, not less than 95% of the *accountable membership interests in each of the entities, and not less than 95% of the *accountable partial interests in each of the entities, are held by, or are held indirectly for the benefit of, the same persons; or
 (b) paragraph (a) does not apply but it would nevertheless be reasonable to conclude, having regard to the matters mentioned in subsection (2), that, throughout that day, the risks involved in, and the opportunities resulting from, holding accountable membership interests, or accountable partial interests, in each of the entities are substantially borne by, or substantially accrue to, the same persons.
 (2) The matters to which regard is to be had as