Legislation

ITAA 1997 s 974-135(7) means that the prospect of some practical or commercial detriment that will arise if the interest rate is reset to zero, or less than a market rate, will not of itself render the contingent obligation to provide financial benefits effectively non-contingent for the purposes of Division 974

ATO documents that consider ITAA 1997 s 974-135(7) means that the prospect of some practical or commercial detriment that will arise if the interest rate is reset to zero, or less than a market rate, will not of itself render the contingent obligation to provide financial benefits effectively non-contingent for the purposes of Division 974

1 document

TD 2006/1currentTD · 2006

Income tax: for the purposes of Division 974 of the Income Tax Assessment Act 1997, if the issuer of an interest bearing instrument can change the rate of interest that will become payable to any rate (including zero) that it chooses at its sole discretion, does the issuer have an 'effectively non-contingent obligation' to provide 'financial benefits' as interest payments from the time that a change in the interest rate could take effect?