Document ID: chunk:federal_register_of_legislation:C2025C00029:section:3:p18
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 3 (pt 18/32)
Character Range: 7236841–7239762

risk‑weighted assets that:
 (a) is attributable to that Australian permanent establishment; and
 (b) is not attributable to the entity's *OB activities.

820‑615  How Subdivision 820‑E applies
 (1) This section has effect for the purposes of applying Subdivision 820‑E to the *head company or single company in relation to a period (the test period) that is all or part of the grouping period.
Note: Subdivision 820‑E applies to the head company or single company if it is classified as an inward investing entity (ADI) because of section 820‑609.

Average equity capital
 (2) The average equity capital of the *head company or single company for the test period is:
 (a) the average value, for that period, of all the *ADI equity capital of the company; plus
 (b) the average value, for that period, of the amount worked out under subsection 820‑613(3).
Note 1: In the case of a choice under section 820‑599, paragraph 820‑603(4)(b) treats the single company and the relevant Australian permanent establishments as a consolidated group.
Note 2: To calculate an average value for the purposes of this Division, see Subdivision 820‑G.

Safe harbour capital amount
 (3) The safe harbour capital amount of the *head company or single company for the test period is worked out using the following method statement.

      Method statement
           Step 1. Work out the average value, for the test period, of the *head company's or single company's *risk‑weighted assets.
           Step 2. Multiply the result of step 1 by 6%. The result of this step is the safe harbour capital amount.

Risk‑weighted assets
 (4) For each of the establishment entity's *Australian permanent establishments covered by the choice, the *risk‑weighted assets of the *head company or single company include that part of the entity's risk‑weighted assets that:
 (a) is attributable to that Australian permanent establishment; and
 (b) is not attributable to the entity's *OB activities.

Subdivision 820‑G—Calculating the average values

Guide to Subdivision 820‑G

820‑625  What this Subdivision is about
      This Subdivision sets out the methods of calculating the average values for the purposes of this Division. It also includes special rules about values and valuation that are relevant to that calculation.
Note: Section 820‑25 of the Income Tax (Transitional Provisions) Act 1997 provides for a transitional rule that affects the operation of this Subdivision in relation to an income year that begins before 1 July 2002 and ends before 30 June 2003.

Table of sections

How to calculate the average values
820‑630 Methods of calculating average values
820‑635 The opening and closing balances method
820‑640 The 3 measurement days method
820‑645 The frequent measurement method

Special rules about values and valuation
820‑675 Amount to be expressed in Australian currency
820‑680 Valuation of assets, liabilities and equity capital