Document ID: chunk:federal_register_of_legislation:C2025C00014:section:23ah:p4
Version: federal_register_of_legislation:C2025C00014
Segment Type: section
Provision Reference: s 23AH (pt 4/5)
Character Range: 137361–139875

derived by the HQ company were disregarded; and
 (d) if the entity is an AFI entity (within the meaning of subsection 326(2))—the entity were an AFI subsidiary; and
 (e) in applying paragraphs 447(1)(a), (c) and (e), the HQ company were an associate of the PE company.
 (14A) This section does not apply to foreign income, or to a capital gain or capital loss, of a company to the extent that the income, gain or loss is from:
 (a) the operation of ships or aircraft in international traffic at or through a PE of the company in a listed country or unlisted country; or
 (b) things that are ancillary to that operation.
 (14B) A company operates a ship or aircraft in international traffic if the company operates it for transporting passengers or goods between a place in one country and a place in another country.

Branch hybrid mismatch income
 (14C) For the purposes of this section, if foreign income derived by the company is an amount that, for the purposes of Division 832 of the Income Tax Assessment Act 1997, is a payment:
 (a) received by the company; and
 (b) that, apart from subsection (4A) of this section, would give rise to a branch hybrid mismatch;
then so much of the foreign income as does not exceed the amount of the branch hybrid mismatch is branch hybrid mismatch income.
 (14D) For the purposes of this section, PE, when it is used in Division 832 of the Income Tax Assessment Act 1997, does not have the meaning it has in that Act but instead has the same meaning as in this section.

Definitions
 (15) In this section:
company does not include a company in the capacity of a trustee.
double tax agreement has the same meaning as in Part X.
eligible designated concession income has the same meaning as in Part X.
foreign income includes an amount that:
 (a) apart from this section, would be included in assessable income under a provision of this Act other than Part 3‑1 or 3‑3 of the Income Tax Assessment Act 1997 (CGT); and
 (b) is derived from sources in a listed country or unlisted country.
listed country has the same meaning as in Part X.
permanent establishment, or PE, in relation to a listed country or unlisted country:
 (a) if there is a double tax agreement in relation to that country—has the same meaning as in the double tax agreement; or
 (b) in any other case—has the meaning given by subsection 6(1).
statutory accounting period has the same meaning as in Part X.
tainted asset has the same meaning as in Part X.
unlisted country has the same meaning as in Part X.