Document ID: chunk:federal_register_of_legislation:C2010C00604:clause:27_3:p5
Version: federal_register_of_legislation:C2010C00604
Segment Type: clause
Provision Reference: sch 27 cl 3 (pt 5/6)
Character Range: 366026–368859

each other distribution made under the same resolution is taken not to have been franked with a venture capital credit.

Subdivision 210‑G—Venture capital sub‑account

Guide to Subdivision 210‑G

210‑85  What this Subdivision is about

      This Subdivision:
         • creates a venture capital sub‑account for each PDF; and
         • identifies when venture capital credits and debits arise in the sub‑account and the amount of those credits and debits; and
         • identifies when there is a venture capital surplus or deficit in the sub‑account; and
         • creates a liability to pay venture capital deficit tax if the account is in deficit at certain times.

Table of sections

210‑90 The venture capital sub‑account
210‑95 Venture capital deficit tax

Operative provisions

210‑100 Venture capital sub‑account
210‑105 Venture capital credits
210‑110 Determining the extent to which a franking credit is reasonably attributable to a particular payment of tax
210‑115 Participating PDF may elect to have venture capital credits arise on its assessment day
210‑120 Venture capital debits
210‑125 Venture capital debit where CGT limit is exceeded
210‑130 Venture capital surplus and deficit
210‑135 Venture capital deficit tax
210‑140 Effect of a liability to pay venture capital deficit tax on franking deficit tax
210‑145 Effect of a liability to pay venture capital deficit tax on the franking account
210‑150 Deferring venture capital deficit

210‑90  The venture capital sub‑account

 (1) Each PDF has a venture capital sub‑account in its franking account. The sub‑account exists even if the PDF does not elect to become a participating PDF by keeping a record of it.

 (2) To the extent that income tax is reasonably attributable to capital gains from venture capital investments, it generates a venture capital credit in the sub‑account. There are other circumstances in which a venture capital credit arises.

 (3) If a PDF receives a refund of that tax, a venture capital debit will arise for the PDF. There are other circumstances in which a venture capital debit will arise, such as on the payment of a distribution franked with a venture capital credit.

210‑95  Venture capital deficit tax

 (1) Venture capital deficit tax is payable if a PDF's venture capital sub‑account is in deficit at the end of the PDF's income year, or immediately before it ceases to be a PDF.

 (2) A PDF's venture capital sub‑account may be in deficit, even if its franking account is not. This can happen because only income tax on income of a particular kind (capital gains on venture capital investments) gives rise to venture capital credits. This means that when a PDF anticipates a venture capital credit, it is not only anticipating that income tax will be paid, but that income tax on income of that kind will be paid.