Document ID: chunk:federal_register_of_legislation:C2025C00014:section:47a:p1
Version: federal_register_of_legislation:C2025C00014
Segment Type: section
Provision Reference: s 47A (pt 1/13)
Character Range: 300206–302832

47A  Distribution benefits—CFCs
 (1) Subject to subsection (2), if:
 (a) a company (in this section called the first company) has profits immediately before a distribution time for a distribution benefit in relation to the first company; and
 (b) the distribution time occurred after 3 June 1990; and
 (c) the first company is a CFC at the distribution time; and
 (d) the first company is a resident of an unlisted country at the distribution time;
so much of the distribution payment in relation to the distribution time as would not otherwise be a dividend and does not exceed the amount of those profits is taken, for the purposes of this Act, to be a dividend paid by the first company:
 (e) to the recipient of the benefit as a shareholder in the first company; and
 (f) out of profits derived by the first company; and
 (g) at the distribution time.
 (2) If:
 (a) any of the following subparagraphs applies:
 (i) by virtue of subsection (1), the whole or a part of the distribution payment is included in the assessable income of a taxpayer of the year of income in which the distribution time occurred under section 44;
 (ii) by virtue of subsection (1), the whole or a part of the distribution payment would, apart from section 23AI or section 768‑5 of the Income Tax Assessment Act 1997, be included in the assessable income of a taxpayer of the year of income in which the distribution time occurred under section 44; and
 (b) both of the following subparagraphs apply:
 (i) the taxpayer's return of income for the year of income was not prepared on the basis that the distribution payment had the consequence specified in subsection (1);
 (ii) the taxpayer has not notified the Commissioner, in writing, within 12 months after the end of the year of income, that the distribution payment had the consequence specified in subsection (1);
that subsection has effect in relation to the taxpayer and in relation to that distribution payment as if the reference in that subsection to the purposes of this Act were a reference to the purposes of this Act (other than section 365 of this Act and Division 770 of the Income Tax Assessment Act 1997).
 (3) Subject to subsections (9) and (12), a reference in this section to a distribution benefit in relation to the first company is a reference to an eligible benefit where the following conditions are satisfied:
 (a) the eligible benefit was provided to:
 (i) an associated entity in relation to the first company; or
 (ii) another entity that, immediately after the time of the provision of the eligible benefit, was an associated entity in relation to the first company;