Document ID: chunk:federal_register_of_legislation:C2025C00029:section:5:p4
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 5 (pt 4/38)
Character Range: 7388511–7391093

foreign income tax deduction.

Payments made to 2 or more entities
 (3) If, in working out the amount of the loss, a payment or payments made to 2 or more entities (each of which is a recipient) are taken into account, this Division applies as if:
 (a) at the end of the income year or *foreign tax period identified in paragraph (1)(a), the payer made a payment to each recipient; and
 (b) the amount of each payment was equal to so much of the amount of the deduction or *foreign income tax deduction as is reasonable having regard to the amounts of the payments actually made to the recipients; and
 (c) the payment gave rise to a deduction or foreign income tax deduction equal to the amount of the payment.

Working out whether the payment has been subject to tax
 (4) In working out for the purposes of this Division the extent to which a payment that is taken by this section to have been made is *subject to Australian income tax or *subject to foreign income tax, regard is to be had to the actual payments made to the recipient.

832‑25  Recipients and payers of a payment
 (1) To the extent this Division applies to a payment only because of section 832‑10 or 832‑15 (a payment provision), it applies as if:
 (a) the entity that made the payment were the entity identified in the payment provision as the payer; and
 (b) the recipient of the payment were the entity identified in the payment provision as the recipient.
 (2) If a payment would, apart from this subsection, be made to 2 or more recipients, then this Division applies as if each part of the payment made to each such recipient were a separate payment.

832‑30  How this Division applies to entities

Identifying payments between entities etc.
 (1) A number of provisions in this Division refer to an entity making a payment to another entity. In determining for the purposes of this Division whether an entity makes or receives a payment, the following are to be disregarded:
 (a) subsection 701‑1(1) (the single entity rule);
 (b) Part IIIB of the Income Tax Assessment Act 1936;
 (c) any law of a foreign country that, for the purposes of a foreign tax, treats a different entity as having made the payment, or disregards the payment.
Note 1: The purpose of this subsection is to establish a uniform basis for recognising "payments" between entities across all jurisdictions. (Note that in some countries, a "payment" recognised by this subsection will not have a tax consequence because the payment is disregarded for tax purposes).
Note 2: As a consequence of paragraph (1)(a), a subsidiary member of a