Last year in the run up to Christmas, the ATO released a draft
ruling on the tax implications of the new corporate law test for
dividends enacted in 2010. Not to be outdone Treasury this year has
released an Exposure Draft (ED) of legislation for a replacement of
the 2010 corporate law dividend test. The more things change
....
The new version keeps the 2010 test for assets exceeding
liabilities in place but overcomes the problem that even companies
which are not otherwise required to keep accounts in accordance
with accounting standards were required to do so for the payment of
dividends by the 2010 law. For this kind of company under the ED
the dividend test is applied on the basis of the financial records
of the company rather than accounting standards.
