Document ID: chunk:federal_register_of_legislation:C2004C00958:clause:1_2:p5
Version: federal_register_of_legislation:C2004C00958
Segment Type: clause
Provision Reference: sch 1 cl 2 (pt 5/7)
Character Range: 554065–556934

continuity period and second continuity period
                                                                            the first continuity period:                         and the second continuity period:
In this case:
the debt was incurred in an earlier income year                             • starts on the day when the debt was incurred; and  is the *current year

                                                                            • ends at the end of that income year
the debt was incurred in the *current year (but not on the last day of it)  • starts on the first day of the *current year; and  • starts on the day after the debt was incurred; and

                                                                            • ends on the day when the debt was incurred         • ends on the last day of the *current year

 (3) A company cannot deduct a debt (or part of a debt) that it writes off as bad on the last day of the *current year if the debt was also incurred on that day.

165‑123  Company must maintain the same owners

Voting power

 (1) There must be persons who had *more than 50% of the voting power in the company during the whole of the *first continuity period. Also, those persons must have had *more than 50% of the voting power in the company during the whole of the *second continuity period.

See section 165‑150 to work out who had more than 50% of the voting power.

Rights to dividends

 (2) There must be persons who had rights to *more than 50% of the company's dividends during the whole of the *first continuity period. Also, those persons must have had rights to *more than 50% of the company's dividends during the whole of the *second continuity period.

See section 165‑155 to work out who had rights to more than 50% of the company's dividends.

Rights to capital distributions

 (3) There must be persons who had rights to *more than 50% of the company's capital distributions during the whole of the *first continuity period. Also, those persons must have had rights to *more than 50% of the company's capital distributions during the whole of the *second continuity period.

See section 165‑160 to work out who had rights to more than 50% of the company's capital distributions.

When to apply the primary test

 (4) To work out whether a condition in this section was satisfied during a period (the ownership test period) that is:

 (a) the *first continuity period; or

 (b) the *second continuity period;

apply the primary test for that condition unless subsection (5) requires the alternative test to be applied.

For the primary test: see subsections 165‑150(1), 165‑155(1)
 and 165‑160(1).

When to apply the alternative test

 (5) Apply the alternative test for that condition if one or more other companies beneficially owned *shares, or interests in shares, in the company