Document ID: chunk:federal_register_of_legislation:C2004A00897:clause:1_2:p2
Version: federal_register_of_legislation:C2004A00897
Segment Type: clause
Provision Reference: sch 1 cl 2 (pt 2/5)
Character Range: 190702–193389

of the definition of debt deduction that are ordinarily payable to an entity other than the relevant entity) are assessable income of the relevant entity for an income year; and
                (c) the terms and conditions for the debt interests are those that would apply if the relevant entity and the associate entity were dealing at arm's length with each other.

           Step 3. Apply steps 2 and 4 to each *associate entity of the relevant entity that is the kind of entity mentioned in paragraph (1)(b) at that time. The lesser of the results of those steps is the associate entity debt amount for that associate entity.
           Step 4. Work out the value, as at that time, of the *debt capital of the *associate entity, to the extent that it is attributable to the *Australian permanent establishments of that associate entity.
           Step 5. Add the associate entity debt amounts for all the *associate entities. The result of this step is the associate entity debt.

820‑915  Associate entity equity

 (1) This section applies to an entity that is an *outward investing entity (non‑ADI) or an *inward investing entity (non‑ADI) for a period that is all or a part of an income year.

 (2) The entity's associate entity equity at a particular time during that period is the sum of:
 (a) the total value of *equity interests that the entity holds in all of its *associate entities at that time; and
 (b) the total value of *debt interests issued to the entity by its associate entities that:
 (i) do not give rise to any *debt deductions for that or any other income year; and
 (ii) remain *on issue at that time.

820‑920  Associate entity excess amount

 (1) This section applies to an entity that is an *outward investing entity (non‑ADI) or an *inward investing entity (non‑ADI) for a period that is all or a part of an income year.

 (2) The 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 entity (the relevant entity) that is an *outward investing entity (non‑ADI) or an *inward investing entity (non‑ADI) 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