Document ID: chunk:federal_register_of_legislation:C2010C00604:clause:29_177ea:p4
Version: federal_register_of_legislation:C2010C00604
Segment Type: clause
Provision Reference: sch 29 cl 177EA (pt 4/6)
Character Range: 447256–450065

or gain, involved in holding or owning the membership interests or having the interest in membership interests;
 (f) the membership interests or interest in membership interests beginning to be included, or ceasing to be included, in any of the insurance funds of a life assurance company.

 (15) In determining whether a distribution flows indirectly to a person, assume that the following provisions had not been enacted:
 (a) section 282B, 283 or 297B of this Act (certain income derived by an eligible entity within the meaning of Part IX of that Act); or
 (b) paragraph 320‑35(1)(b) of the Income Tax Assessment Act 1997 (segregated exempt assets) or subparagraph 320‑35(1)(f)(ii) of that Act (income bonds, funeral policies and scholarship plans).

When imputation benefit is received

 (16) A taxpayer to whom a distribution flows indirectly receives an imputation benefit as a result of the distribution if:
 (a) the taxpayer is entitled to a tax offset under Division 207 of the Income Tax Assessment Act 1997 as a result of the distribution; or
 (b) where the taxpayer is a corporate tax entity—a franking credit would arise in the franking account of the taxpayer as a result of the distribution.

Note: Where the distribution is made directly to the taxpayer, see subsection 204‑30(6) of the Income Tax Assessment Act 1997 for a definition of imputation benefit.

Meaning of relevant circumstances of scheme

 (17) The relevant circumstances of a scheme include the following:
 (a) the extent and duration of the risks of loss, and the opportunities for profit or gain, from holding membership interests, or having interests in membership interests, in the corporate tax entity that are respectively borne by or accrue to the parties to the scheme, and whether there has been any change in those risks and opportunities for the relevant taxpayer or any other party to the scheme (for example, a change resulting from the making of any contract, the granting of any option or the entering into of any arrangement with respect to any membership interests, or interests in membership interests, in the corporate tax entity);
 (b) whether the relevant taxpayer would, in the year of income in which the distribution is made, or if the distribution flows indirectly to the relevant taxpayer, in the year in which the distribution flows indirectly to the relevant taxpayer, derive a greater benefit from franking credits than other entities who hold membership interests, or have interests in membership interests, in the corporate tax entity;
 (c) whether, apart from the scheme, the corporate tax entity would have retained the franking credits or exempting credits or would have used the franking credits or exempting credits to pay a franked distribution to another entity referred to in paragraph