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Corporate Financing – Debt Which Does Not Generate Assessable Income

Published on 17 Nov 2010 | Took place at RACV Club, Melbourne , VIC

The ATO in recent times has been exploring ways to challenge interest deductions on borrowings of Australian resident companies, particularly where the borrowings are from related foreign parties. Many of these issues are currently under investigation by the ATO during the course of reviews and audits. An important development has been the finalisation of Taxation Ruling 2010/7 on the interaction of the transfer pricing and thin capitalisation rules.

This event analysed these issues in the context of debt which funds:

  • distributions to owners (including dividends under new section 254T of the Corporations Act)
  • Section 23AJ and foreign branch investments
  • refinancing of group debt.

Individual sessions

Debt which does not generate assessable income

Author(s):  Cameron RIDER This presentation covers:

  • base case
  • will interest be deductible
  • debt test
  • thin capitalisation: Div 820
  • transfer pricing
  • anti-avoidance - miscellaneous issues
  • limitations on TR95/25
  • distribution sourced in intra-group sale
  • new s254T of Corporations Act.
Materials from this session: