Document ID: chunk:federal_register_of_legislation:C2025C00029:section:3:p50
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 3 (pt 50/79)
Character Range: 4964470–4967380

Table of sections
316‑255 General taxation consequences of issue of demutualisation assets etc.
316‑260 Franking debits to stop the friendly society and its subsidiaries having franking surpluses
316‑265 Franking debits to negate franking credits from some distributions to friendly society and subsidiaries
316‑270 Franking debits to negate franking credits from post‑demutualisation payments of pre‑demutualisation tax
316‑275 Franking credits to negate franking debits from refunds of tax paid before demutualisation

316‑255  General taxation consequences of issue of demutualisation assets etc.
 (1) An amount of *ordinary income or *statutory income (other than a *net capital gain) of an entity covered by subsection (2) is not assessable income and is not *exempt income if:
 (a) the amount would otherwise be included in the ordinary income or statutory income of the entity only because a demutualisation asset (see section 316‑110) was issued to the entity; or
 (b) the amount is a payment made to the entity, under the demutualisation, in connection with:
 (i) the variation or abrogation of rights attaching to or consisting of an interest affected by demutualisation (see paragraph 316‑55(1)(b)); or
 (ii) the conversion, cancellation, extinguishment or redemption of an interest affected by demutualisation; or
 (c) the amount would otherwise be included in the ordinary income or statutory income of the entity only because a *share or a right to *acquire one or more shares was transferred to the entity by the trustee of a lost policy holders trust (see section 316‑155); or
 (d) the amount is a payment made to the entity from a lost policy holders trust in connection with:
 (i) the variation or abrogation of rights attaching to or consisting of an interest affected by demutualisation; or
 (ii) the conversion, cancellation, extinguishment or redemption of an interest affected by demutualisation.
 (2) This subsection covers an entity that:
 (a) is or has been a *member of the *friendly society; or
 (b) is or has been insured through the friendly society or a health/life insurance subsidiary of the friendly society; or
 (c) is issued with the demutualisation asset, or receives the payment, because of the death of a person covered by paragraph (a) or (b); or
 (d) is a beneficiary of a lost policy holders trust (see section 316‑155).

316‑260  Franking debits to stop the friendly society and its subsidiaries having franking surpluses
 (1) A *franking debit arises in the *franking account of the *friendly society or a *wholly‑owned subsidiary of the society if the account is in *surplus immediately before the demutualisation resolution day identified under subsection 316‑70(4).
 (2) The amount of the *franking debit equals the *surplus.
 (3) The *franking debit arises at the start of that day.

316‑265  Franking debits to negate franking credits from some distributions to