Division 7A Miscellaneous 2017

Division 7A structuring: The contortionist revisited

Source: The Tax Specialist Journal Article

Published Date: 1 Mar 2017


Under the 2016 federal Budget amendments, quarantined pre-4 December 1997 loans and pre-16 December 2009 unpaid present entitlements (UPEs) may become subject to new loan rules. In addition, 30 June 2010 subsisting UPEs on a seven-year interest-only investment agreement will require principal repayment by 30 June 2018, presenting cash-flow problems for family groups that advisers must address now. This article discusses and assesses the risks of Div 7A loans, UPE compliance management and repayment planning options, and the potential impact of proposed Div 7A reforms. The author also analyses: the intersection of Div 7A deemed dividends, Div 245 debt forgiveness, Div 974 at-call loans, and s 100A reimbursement agreements on UPEs; the impact of the Board of Taxation and 2016 federal Budget proposed reforms; strategies for the management of pre-1997 loans and UPEs and pre-2009 quarantined UPEs; and strategies for repaying and restructuring loans and UPEs so that Div 7A does not apply.

Sorry, this is subscriber only content.

To gain access to this material and much more - Subscribe Now.

(Note: Members can access Taxation in Australia journal articles without a Tax Knowledge Exchange subscription - please log in to access).

Already a Subscriber? Login now

Already a Subscriber? Login now


The material is copyright. Apart any fair dealing for the purpose of private study, research criticism or review, as permitted under the copyright Act, no part may be reproduced by any process without written permission from The Tax Institute.

Unless expressly stated, opinions are not that of The Tax Institute, which accepts no responsibility for the accuracy of any of the information contained within it.

The Tax Institute
(ABN 45 008 392 372 (PRV14016))


The Tax Institute is a Recognised Tax Agent Association (RTAA) under the Tax Agent Services Regulations 2009. 

Copyright Statement

All materials provided on this site are protected by copyright and are owned by or licensed to TTI.

Except as expressly permitted by TTI or the copyright owner, any person or company who uses this site must not use, reproduce, redistribute, retransmit, publish or otherwise transfer, or commercially exploit, the materials or any information, software or other content, in whole or in part, which is available through this site.


Division 7A Miscellaneous 2017

Share this page