Document ID: chunk:federal_register_of_legislation:C2025C00029:section:3:p19
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 3 (pt 19/46)
Character Range: 3100509–3103188

Division 166 company has maintained the same owners
166‑E Concessional tracing rules

Guide to Division 166

166‑1  What this Division is about

      This Division modifies the way the rules in Division 165 apply to a widely held or eligible Division 166 company by making it easier for the company to apply the rules.
      If the company has maintained the same owners as between certain points of time, it does not need to prove it has maintained the same owners throughout the periods in between.
      In certain cases, special concessional tracing rules deem entities to hold voting, dividend or capital stakes in the company so that the company does not have to trace through to the ultimate beneficial owners of the stakes.

Subdivision 166‑AA—The object of this Division

166‑3  The object of this Division
 (1) The object of this Division is to make it easier for a *widely held company, or an *eligible Division 166 company, to apply the rules in Division 165 (because of the difficulty the company might have under that Division in actually tracing through to the ultimate beneficial owners of *voting stakes, *dividend stakes and *capital stakes in the company).
 (2) This Division makes it easier to apply the rules in Division 165 by:
 (a) making it unnecessary for the company to prove that it has maintained the same owners throughout a period, if the company had the same owners at certain test times; and
 (b) making it unnecessary for the company to trace through to the ultimate beneficial owners of:
 (i) *voting stakes, *dividend stakes and *capital stakes in the company held by certain entities (whether directly, or *indirectly through one or more interposed entities); and
 (ii) small voting stakes, dividend stakes and capital stakes in the company.

Subdivision 166‑A—Deducting tax losses of earlier income years

Table of sections
166‑5 How Subdivision 165‑A applies to a widely held or eligible Division 166 company
166‑15 Companies can choose that this Subdivision is not to apply to them

166‑5  How Subdivision 165‑A applies to a widely held or eligible Division 166 company
 (1) This Subdivision modifies the way Subdivision 165‑A applies to a company that is:
 (a) a *widely held company at all times during the income year; or
 (b) an *eligible Division 166 company at all times during the income year; or
 (c) a widely held company for a part of the income year and an eligible Division 166 company for the rest of the income year.
Note 1: Subdivision 165‑A is about the conditions a company must meet before it can deduct a tax loss for an earlier income year.
Note 2: A company can choose that this Subdivision is not to apply to it: see