Income tax: thin capitalisation by non-residents: is the retrospective creation, or amendment, of an asset revaluation reserve allowed for the purposes of Div 16F of the Income Tax Assessment Act 1936?

No. In measuring foreign equity, section 159GZG requires an asset revaluation reserve to be in place in the company's accounting records at the beginning of the relevant financial year.

If a company holds information which supports a revaluation of any assets in its accounts, for the relevant financial year, but does not formalise the revaluation by placing an entry into an asset revaluation reserve, then the company is precluded from retrospectively creating or amending an asset revaluation reserve.