Document ID: chunk:federal_register_of_legislation:C2005C00443:clause:1_3:p1
Version: federal_register_of_legislation:C2005C00443
Segment Type: clause
Provision Reference: sch 1 cl 3 (pt 1/4)
Character Range: 5130–7977

3  Before Division 775
Insert:

Division 768—Exempt foreign income and gains

Table of Subdivisions

768‑G Reduction in capital gains and losses arising from CGT events in relation to non‑portfolio interests in active foreign companies

Subdivision 768‑G—Reduction in capital gains and losses arising from CGT events in relation to non‑portfolio interests in active foreign companies

Guide to Subdivision 768‑G

768‑500  What this Subdivision is about

      If:

                (a) a company has a capital gain or capital loss arising from a CGT event that happens in relation to a share in a foreign company; and
                (b) the company holds a direct voting percentage of 10% or more in the foreign company for a certain period before the CGT event happens;
      the gain or loss is reduced by a percentage that reflects the degree to which the assets of the foreign company are used in an active business.

Table of sections

Operative provisions

768‑505 Reducing a capital gain or loss from certain CGT events in relation to non‑portfolio interests

Active foreign business asset percentage

768‑510 Active foreign business asset percentage
768‑515 Choices to apply market value method or book value method
768‑520 Market value method—choice made under subsection 768‑515(1)
768‑525 Book value method—choice made under subsection 768‑515(2)
768‑530 Active foreign business asset percentage—modifications for foreign life insurance companies and foreign general insurance companies
768‑535 Modified rules for foreign wholly‑owned groups

Types of assets of a foreign company

768‑540 Active foreign business assets of a foreign company
768‑545 Assets included in the total assets of a foreign company

Voting percentages in a company

768‑550 Direct voting percentage in a company
768‑555 Indirect voting percentage in a company
768‑560 Total voting percentage in a company

[This is the end of the Guide.]

Operative provisions

768‑505  Reducing a capital gain or loss from certain CGT events in relation to non‑portfolio interests

 (1) The *capital gain or *capital loss a company (the holding company) makes from a *CGT event that happened at a particular time (the time of the CGT event) to a *share in a company (the foreign disposal company) that is a foreign resident is reduced if:
 (a) the holding company held a *direct voting percentage of 10% or more in the foreign disposal company throughout a 12 month period that:
 (i) began no earlier than 24 months before the time of the CGT event; and
 (ii) ended no later than that time; and
 (b) the share is not:
 (i) an eligible finance share (within the meaning of Part X of the Income Tax Assessment Act 1936); or
 (ii) a widely distributed finance share (within the meaning of that Part); and
 (c) the CGT event is CGT event A1, B1, C2, E1, E2, G3, J1, K4,