Document ID: chunk:federal_register_of_legislation:C2018A00084:clause:1_1:p19
Version: federal_register_of_legislation:C2018A00084
Segment Type: clause
Provision Reference: sch 1 cl 1 (pt 19/35)
Character Range: 48072–50616

For the meaning of liable entity, see section 832‑325.

832‑320  Hybrid payer
 (1) An entity (the test entity) is a hybrid payer in relation to a payment it makes if:
 (a) subsection (2) applies to the entity in relation to a country and the payment; and
 (b) subsection (3) applies to the entity in relation to a different country and the payment.
Note: The entity, the payments it makes, and its income or profits are identified disregarding tax provisions: see section 832‑30.

Deducting country—entity is not grouped with recipient
 (2) This subsection applies to a test entity in relation to a country (the deducting country) and a payment the test entity makes if:
 (a) the test entity, or another entity, is a *liable entity in the deducting country in respect of income or profits of the test entity (or a part of those income or profits); and
 (b) that liable entity is not also a liable entity in the deducting country in respect of income or profits of the recipient of the payment.

Non‑including country—entity is grouped with recipient
 (3) This subsection applies to a test entity in relation to a country (a non‑including country) and a payment the test entity makes if:
 (a) the test entity, or another entity, is a *liable entity in the non‑including country in respect of income or profits of the test entity (or a part of the income or profits); and
 (b) that liable entity is also a liable entity in the non‑including country in respect of income or profits of the recipient of the payment.

832‑325  Meaning of liable entity

Entity is a taxpayer in respect of its own income or profits
 (1) An entity is a liable entity, in a country, in respect of its income or profits if:
 (a) for Australia—*tax is imposed on the entity in respect of all or part of its income or profits for an income year; and
 (b) for a foreign country—*foreign income tax (except *credit absorption tax, *unitary tax or a withholding‑type tax) is imposed under the law of the foreign country on the entity in respect of all or part of its income or profits for a *foreign tax period.
Note 1: The entity, and its income or profits, are identified disregarding tax provisions: see section 832‑30.
Note 2: An example is an entity that is a company (and is not a member of a consolidated group). In Australia, a company is the liable entity in respect of its income or profits.

Entity is a taxpayer in respect of another entity's income or profits
 (2) An entity is a liable entity, in a country, in respect of the income or profits of another entity