12 Mar 09 Can a company taint its share capital account under a DRP? - TD 2009/4This final Taxation Determination was issued on 11 March 2009. It was previously released in draft form as TD 2008/D17. Its full title is "Income tax: in accounting for a Dividend Re-investment Plan, can a company taint its share capital account for the purposes of Division 197 of the ITAA 1997?" The answer given is:
"No. A Dividend Re-investment Plan (DRP) with the features outlined at paragraph 11 and accounted for in accordance with paragraphs 4 or 8 of this Determination will not taint the issuing company's share capital account for the purposes of Division 197 of the ITAA 1997. However, as noted in paragraph 12, this Determination does not deal with Bonus Share Plans and 'scrip dividends'."
For a copy of TD 2009/4, go here.