In a case where the total amount available for income allocation is allocated as an annual payment, the Tax Acts apply as if the total amounts were payments of interest made on the payment by the authorised investment fund to the participants in proportion to their rights1. An interest distribution is treated as not being a tax-interest expense amount of the authorised investment fund for the purpose of the corporate interest restriction 2 and as an annual payment3.
Qualifying investment test
An amount can only be shown as available for distribution as yearly interest if the fund meets the qualifying investment test throughout the distribution period4.
The qualifying investment test is met if throughout the distribution period (the 'relevant period'), the market value of qualifying investments exceeds 60% of the market value of all investments of the fund5.
The
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