Document ID: chunk:federal_register_of_legislation:C2018A00084:clause:1_1:p1
Version: federal_register_of_legislation:C2018A00084
Segment Type: clause
Provision Reference: sch 1 cl 1 (pt 1/35)
Character Range: 2767–5681

1  After Division 830
Insert:

Division 832—Hybrid mismatch rules

Table of Subdivisions
 Guide to Division 832
832‑A Preliminary
832‑B Concepts relating to mismatches
832‑C Hybrid financial instrument mismatch
832‑D Hybrid payer mismatch
832‑E Reverse hybrid mismatch
832‑F Branch hybrid mismatch
832‑G Deducting hybrid mismatch
832‑H Imported hybrid mismatch
832‑I Dual inclusion income
832‑J Integrity rule
832‑K Modifications for Division 230 (about taxation of financial arrangements)

Guide to Division 832

832‑1  What this Division is about

      A "hybrid mismatch" arises if double non‑taxation results from the exploitation of differences in the tax treatment of an entity or financial instrument under the laws of 2 or more countries.
      There is double non‑taxation if a deductible payment is not included in a tax base (this is called a deduction/non‑inclusion mismatch), or if a payment gives rise to 2 deductions (this is called a deduction/deduction mismatch). Disallowing a deduction, or including an amount in assessable income, "neutralises" this tax advantage.

Subdivision 832‑A—Preliminary

Guide to Subdivision 832‑A

832‑5  What this Subdivision is about
      This Subdivision sets out some general rules that apply to the provisions of this Division.

Table of sections

Operative provisions
832‑10 Entitlement to receive payment
832‑15 Entitlement to receive non‑cash benefits
832‑20 Losses that arise from payments or parts of payments
832‑25 Recipients and payers of a payment
832‑30 Tax provisions to be disregarded in identifying payments and income or profits
832‑35 Single entity rule otherwise not disregarded
832‑40 Schemes outside Australia
832‑45 Relationship between this Division and other charging provisions in this Act
832‑50 Relationship between this Division and Division 820
832‑55 Division does not affect foreign residence rules
832‑60 Valuation of trading stock affected by hybrid mismatch rules

Operative provisions

832‑10  Entitlement to receive payment
  This Division applies as if an entity (the payer) had made a payment to another entity (the recipient) if the recipient is entitled to receive the payment from the payer, even if the payment is not required to be made until a later time.

832‑15  Entitlement to receive non‑cash benefits
  This Division applies as if an entity (the payer) had made a payment to another entity (the recipient) if the recipient received a *non‑cash benefit from the payer.

832‑20  Losses that arise from payments or parts of payments
 (1) This section applies if:
 (a) a loss gives rise to:
 (i) a deduction for an entity (the payer) for an income year; or
 (ii) a *foreign income tax deduction for an entity (also the payer) for a *foreign tax period; and
 (b) in working out the amount of the loss:
 (i) all or a part of a payment made, or to be made, to one or more other entities is taken into account; or
 (ii) 2