Commentary on Division 220 of ITAA 1997: Trans-Tasman triangular imputation

Dabner, Justin (2003) Commentary on Division 220 of ITAA 1997: Trans-Tasman triangular imputation. In: Murray-Jones, Ian, (ed.) Australian Tax Practice. Thomson Legal and Regulatory, Pyrmont, NSW, Australia, - .

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[Extract] Division 220 facilitates the entry of New Zealand resident companies to the Australian imputation system to gain access to franking credits when they make payments of Australian income tax or withholding tax or receive a franked distribution from an Australian company. These Australian franking credits can then be passed on to the NZ companies' Australian shareholders, alleviating the double taxation otherwise suffered by those shareholders from the "triangular" nature of their investment. Australian shareholders will access their franking benefits on a pro rata basis, ie in proportion to their shareholding in the NZ company.

The taxation problems created by trans-Tasman triangular investments and the background to the enactment of Div 220 are examined in [220.1040].

The Regulatory Impact Statement prepared for the legislation that enacted Div 220 (see [220.1040]) estimated that between 500 and 1,000 NZ companies would elect to enter the Australian imputation system, while between 50 and 100 large Australian companies (and an unknown number of smaller companies) may benefit from the reciprocal changes to the NZ imputation system.

Item ID: 4993
Item Type: Book Chapter (Research - B1)
ISBN: 978-0-86460-011-0
Keywords: taxation, taxation law
Date Deposited: 31 Aug 2010 00:29
FoR Codes: 18 LAW AND LEGAL STUDIES > 1801 Law > 180125 Taxation Law @ 100%
SEO Codes: 97 EXPANDING KNOWLEDGE > 970118 Expanding Knowledge in Law and Legal Studies @ 100%
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