Document ID: chunk:federal_register_of_legislation:C2025C00014:section:45b:p1
Version: federal_register_of_legislation:C2025C00014
Segment Type: section
Provision Reference: s 45B (pt 1/3)
Character Range: 279180–281776

45B  Schemes to provide certain benefits

Purpose of section
 (1) The purpose of this section is to ensure that relevant amounts are treated as dividends for taxation purposes if:
 (a) components of a demerger allocation as between capital and profit do not reflect the circumstances of a demerger; or
 (b) certain payments, allocations and distributions are made in substitution for dividends.

Application of section
 (2) This section applies if:
 (a) there is a scheme under which a person is provided with a demerger benefit or a capital benefit by a company; and
 (b) under the scheme, a taxpayer (the relevant taxpayer), who may or may not be the person provided with the demerger benefit or the capital benefit, obtains a tax benefit; and
 (c) having regard to the relevant circumstances of the scheme, it would be concluded that the person, or one of the persons, who entered into or carried out the scheme or any part of the scheme did so for a purpose (whether or not the dominant purpose but not including an incidental purpose) of enabling a taxpayer (the relevant taxpayer) to obtain a tax benefit.

Commissioner to determine that section 45BA or 45C applies
 (3) The Commissioner may make, in writing, a determination that:
 (a) section 45BA applies in relation to the whole, or a part, of the demerger benefit; or
 (b) section 45C applies in relation to the whole, or a part, of the capital benefit.
A determination does not form part of an assessment.
Note: If section 45BA applies in relation to the whole, or a part, of a demerger benefit, this benefit may be a capital benefit.

Meaning of provided with a demerger benefit
 (4) A person is provided with a demerger benefit if in relation to a demerger:
 (a) a company provides the person with ownership interests in that or another company; or
 (b) something is done in relation to an ownership interest owned by the person that has the effect of increasing the value of an ownership interest (which may or may not be the same ownership interest) owned by the person.

Meaning of provided with a capital benefit
 (5) A reference to a person being provided with a capital benefit is a reference to any of the following:
 (a) the provision of ownership interests in a company to the person;
 (b) the distribution to the person of share capital or share premium;
 (c) something that is done in relation to an ownership interest that has the effect of increasing the value of an ownership interest (which may or may not be the same interest) that is held by the person.
 (6) However, a person is not provided with a capital benefit