Document ID: chunk:federal_register_of_legislation:C2004C00958:clause:1_8:p5
Version: federal_register_of_legislation:C2004C00958
Segment Type: clause
Provision Reference: sch 1 cl 8 (pt 5/14)
Character Range: 491691–494346

entity controls the company (alone or with an *associate).

140‑22  When an entity has an associate‑inclusive control interest

 (1) An entity has an associate‑inclusive control interest in a company in the circumstances set out in Subdivision A of Division 3 of Part X of the Income Tax Assessment Act 1936.

 (2) However, in working out whether an entity has an *associate‑inclusive control interest of a particular percentage for the purposes of section 140‑20, there are these modifications to the way Part X of that Act operates:

 (a) that Part is applied to any company, including one acting as a trustee; and

 (b) subsection 349(4) applies in all cases in working out which entity holds a direct control interest or a control tracing interest equal to 100%; and

 (c) subsections 350(6) and (7) and 355(1) are ignored; and

 (d) despite subsection 352(2), an interposed entity may be taken into account in calculating an indirect control interest if it is:

 (i) a company of which the first entity or an *associate is a controller; or

 (ii) a partnership or a trust; and

 (e) section 354 applies as if it referred to partnerships rather than CFP's; and

 (f) section 355 applies as if it referred to trusts rather than CFT's.

Note 1: Part X of the Income Tax Assessment Act 1936 defines company to exclude one in the capacity of a trustee.

Note 2: The terms direct control interest and control tracing interest are relevant to working out associate‑inclusive control interests in a company: see sections 350, 351, 353, 354 and 355 of that Act.

Note 3: Under subsection 349(4) of that Act, if 2 or more entities would have a direct control interest or a control tracing interest in a company or trust equal to 100%, only one of them holds the interest.

Note 4: Subsections 350(6) and (7) deal with direct control interests in a company. They deal with interests held by Australian entities. Under subsection 355(1), certain entities are taken to hold a control tracing interest in a trust equal to 100%.

Note 5: Paragraphs 140‑22(2)(d), (e) and (f) are necessary because Part X of the Income Tax Assessment Act 1936 applies only to CFE's (which comprise CFC's, CFP's and CFT's).

140‑25  When is there a material decrease in the value of a share?

  There is a material decrease in the market value of a *decreased value share if:

 (a) the total of the percentage decreases in its market value because of *share value shifts that occur under the *scheme is at least 5%; or

 (b) the total of the decreases in the market value of all shares whose market value decreased because of *share value shifts that occur under