Document ID: chunk:federal_register_of_legislation:C2018A00084:clause:1_1:p32
Version: federal_register_of_legislation:C2018A00084
Segment Type: clause
Provision Reference: sch 1 cl 1 (pt 32/35)
Character Range: 80845–83582

deduction (a deducting country) is a primary response country in relation to the *deducting hybrid mismatch unless the country is identified as the secondary response country under subsection (4), (5), (6), (7) or (8).

Both countries recognise the same liable entity—residence country is secondary response
 (4) If:
 (a) the *deducting hybrid is itself the *liable entity in each deducting country; and
 (b) in one deducting country, the deducting hybrid does not satisfy the residency test in subsection (9); and
 (c) in the other deducting country, the deducting hybrid does satisfy the residency test;
then the country mentioned in paragraph (b) is the secondary response country.
 (5) If:
 (a) in both deducting countries, the same entity is the *liable entity in respect of the income or profits of the *deducting hybrid; and
 (b) in one deducting country, the liable entity does not satisfy the residency test in subsection (9); and
 (c) in the other deducting country, the liable entity does satisfy the residency test;
then the country mentioned in paragraph (b) is the secondary response country.

Countries recognise different liable entities—non‑parent country is secondary response
 (6) If:
 (a) the *liable entity for one deducting country is a different entity to the entity that is the liable entity for the other deducting country; and
 (b) in one deducting country, the *deducting hybrid is the liable entity;
then the country mentioned in paragraph (b) is the secondary response country.
 (7) If:
 (a) the *liable entity for one deducting country is a different entity to the entity that is the liable entity for the other deducting country; and
 (b) the *deducting hybrid is not the liable entity in either country; and
 (c) in one deducting country, the entity that is a liable entity is also a liable entity in respect of the income or profits of the entity that is the liable entity in the other deducting country;
then the country mentioned second in paragraph (c) is the secondary response country.
 (8) If:
 (a) the *liable entity for one deducting country is a different entity to the entity that is the liable entity for the other deducting country; and
 (b) subsections (6) and (7) do not apply; and
 (c) in one deducting country, the deducting hybrid and the liable entity both satisfy the residency test in subsection (9);
then the country mentioned in paragraph (c) is the secondary response country.

Residency test
 (9) An entity satisfies the residency test in this subsection in relation to a country, if:
 (a) if the country is Australia—the entity is an *Australian entity; or
 (b) if the country is a foreign country:
 (i) the entity is a resident of the foreign country for the purposes of the law