Document ID: chunk:federal_register_of_legislation:C2025C00029:section:4:p3
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 4 (pt 3/34)
Character Range: 3531696–3534499

(if any), and the terms applicable to the trust because of the operation of legislation, the common law or the rules of equity.

Subdivision 207‑C—Residency requirements for the general rule

Guide to Subdivision 207‑C

207‑60  What this Subdivision is about
      Some recipients of a franked distribution must satisfy a residency requirement if their assessable income is to include the franking credit on the distribution, and they are to be entitled to a tax offset, under the general rule.

Table of sections
207‑65 Satisfying the residency requirement

Operative provisions
207‑70 Gross‑up and tax offset under section 207‑20
207‑75 Residency requirement

207‑65  Satisfying the residency requirement
 (1) This Subdivision sets out the residency requirements that must be satisfied by an individual or a corporate tax entity that receives a franked distribution, if the franking credit on the distribution is to be included in that entity's assessable income, or the entity is to be entitled to a tax offset, under the general rule.
 (2) It does not impose a residency requirement on other entities, because the significance of residency for those entities is dealt with elsewhere in this Act.
 (3) It does not impose a residency requirement where a distribution flows indirectly to an entity. This is also because the significance of residency is dealt with elsewhere, for the most part in Divisions 5 and 6 of Part III of the Income Tax Assessment Act 1936.

Operative provisions

207‑70  Gross‑up and tax offset under section 207‑20
  If an entity makes a *franked distribution to an individual or a *corporate tax entity:
 (a) no amount is included in the receiving entity's assessable income under subsection 207‑20(1); and
 (b) the receiving entity is not entitled to a *tax offset under subsection 207‑20(2);
unless the receiving entity satisfies the *residency requirement at the time the distribution is made.

207‑75  Residency requirement
 (1) An entity that receives a *distribution satisfies the residency requirement at the time the distribution is made if:
 (a) in the case of an individual—the individual is an Australian resident at that time; and
 (b) in the case of a company—the company is an Australian resident at that time; and
 (c) in the case of a *corporate limited partnership—the corporate limited partnership is an Australian resident at that time; and
 (e) in the case of a *public trading trust—the public trading trust is a resident unit trust for the income year in which that time occurs.
 (2) An entity that receives a *distribution also satisfies the residency requirement at the time the distribution is made if the entity at that time:
 (a) is a company or an individual; and
 (b) is a foreign resident; and
 (c) carries on business in Australia at or through