Document ID: chunk:federal_register_of_legislation:C2025C00029:section:2:p3
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 2 (pt 3/6)
Character Range: 7302607–7305247

that are held for the purposes of producing the foreign entity's assessable income.
 (3) The relevant entity's associate entity equity at a particular time during the relevant period is the total value of:
 (a) all the *equity interests that the entity holds, at that time, in relevant associate entities; and
 (b) all the *debt interests *on issue and held by the relevant entity at that time that satisfy all of the following:
 (i) the interests were *issued by relevant associate entities;
 (ii) neither the value of each of the interests, nor any part of that value, is all or a part of any *cost‑free debt capital of the issuer of the interest at that time;
 (iii) none of the interests gives rise to any cost, at any time, that is covered by paragraph 820‑40(1)(a); and
 (c) all the debt interests on issue and held by the relevant entity at that time that satisfy both of the following:
 (i) the interests were issued by relevant associate entities;
 (ii) each of the interests gives rise to a cost, at any time, that is covered by paragraph 820‑40(1)(a), but the cost is not deductible from the assessable income of the issuer of the interest for any income year.
 (4) For the purposes of subsection (3), take into account the value of an *equity interest in, or a *debt interest issued by, a *foreign entity only to the extent that the interest is attributable to assets covered by subparagraph (2)(b)(i) or (ii) that are held by the foreign entity throughout the relevant period.

820‑920  Associate entity excess amount
 (1) This section applies to an entity (the relevant entity) that is an *outward investing financial entity (non‑ADI) or an *inward investing financial entity (non‑ADI) for a period that is all or a part of an income year.
 (2) The relevant entity's associate entity excess amount at a particular time during that period is the result of applying the method statement in this subsection.

      Method statement
           Step 1. Work out the premium excess amount (see subsection (3)), as at that particular time, for an *associate entity of the relevant entity that is the issuer of an *equity interest or a *debt interest any value of which is all or a part of the relevant entity's *associate entity equity at that time.
           Step 2. Add to the result of step 1 the attributable safe harbour excess amount (see subsection (4)) for that *associate entity as at that time.
           Step 3. Apply steps 1 and 2 to all such *associate entities of the relevant entity and add all the results that are positive amounts. The result of this step is the associate entity excess amount.
 (3) An *associate