15Companies ceasing to exist

##### 15 Companies ceasing to exist (1) This section has effect for the purposes of the application of this Act: (a) in relation to a sale or sales of shares under a scheme where, after the last sale time and either before or after the commencement of this Act, a company ceased to exist, being a company more than 90% of the voting power in which was, by virtue of rights attaching to the shares, capable of being controlled immediately before the first sale time, either directly or through one or more interposed companies, trustees or partnerships, by the person or persons who sold the shares; and (b) in relation to a purchase or purchases of shares under a scheme where, after the last purchase time and either before or after the commencement of this Act, a company ceased to exist, being a company more than 90% of the voting power in which was, by virtue of rights attaching to the shares, capable of being controlled immediately after the last purchase time, either directly or through one or more interposed companies, trustees or partnerships, by the person or persons who purchased the shares. (2) Where the company ceased to exist after an assessment was made of the ordinary company tax or undistributed profits tax payable by the company in relation to a year of income: (a) if the company ceased to exist before the tax became due and payable under the assessment: (i) the tax shall be taken to have become due and payable under the assessment notwithstanding that the company ceased to exist; and (ii) the liability of the company in respect of ordinary company tax or undistributed profits tax, as the case may be, in relation to the year of income shall not be taken to have been affected or to be affected by the fact that the company ceased to exist; and (b) if the company ceased to exist after the tax became due and payable under the assessment—the liability of the company in respect of ordinary company tax or undistributed profits tax, as the case may be, in relation to the year of income shall not be taken to have been affected or to be affected by the fact that the company ceased to exist. (3) Where: (a) the company ceased to exist after an assessment was made of the ordinary company tax or undistributed profits tax payable by the company in relation to a year of income (in this section referred to as the relevant year of income); (b) if the company had not ceased to exist, the Commissioner would be empowered under the Assessment Act to amend the assessment; and (c) a person or persons: (i) is or are liable to pay recoupment tax; (ii) in the opinion of the Commissioner is likely or are likely to become liable to pay recoupment tax; or (iii) in the opinion of the Commissioner would, if the amendment were made, be likely to become liable to pay recoupment tax; in relation to ordinary company tax or undistributed profits tax, as the case may be, payable by the company in relation to the relevant year of income; the Commissioner may make an amended assessment (in this section referred to as the notional assessment) of the ordinary company tax (in this section referred to as the notional ordinary company tax) or undistributed profits tax (in this section referred to as the notional undistributed profits tax), as the case may be, that would be payable by the company in relation to the relevant year of income if the company had not ceased to exist. (4) Where: (a) the company ceased to exist before an assessment was made of the ordinary company tax or undistributed profits tax payable by the company in relation to a year of income (in this section also referred to as the relevant year of income), being the year of income in which the last sale time or last purchase time in relation to the scheme occurred or a preceding year of income; and (b) the Commissioner is of the opinion that, if the company had not ceased to exist and an assessment had been made of the ordinary company tax or undistributed profits tax, as the case may be, payable by the company in relation to the relevant year of income: (i) ordinary company tax or undistributed profits tax, as the case may be, would have become due and payable by the company in relation to the relevant year of income; and (ii) if that ordinary company tax or undistributed profits tax, as the case may be, had remained unpaid, recoupment tax would have become payable by a person or persons in relation to the ordinary company tax or undistributed profits tax, as the case may be, payable by the company in relation to the relevant year of income; the Commissioner may make an assessment (in this section also referred to as the notional assessment) of the ordinary company tax (in this section also referred to as the notional ordinary company tax) or undistributed profits tax (in this section also referred to as the notional undistributed profits tax), as the case may be, that would be payable by the company in relation to the relevant year of income if the company had not ceased to exist. (5) For the purposes of the making of an assessment under subsection (4) of undistributed profits tax that would be payable by a company if it had not ceased to exist, any dividends that the company might have paid if it had not ceased to exist shall be disregarded. (6) Where all of the recoupment tax referred to in subsection (3) or (4) is promoters recoupment tax, the Commissioner shall serve notice of the notional assessment referred to in that subsection on the person, or one of the persons, as the case may be, referred to in paragraph (3)(c) or subparagraph (4)(b)(ii), as the case may be. (7) Where subsection (6) does not apply in relation to the notional assessment, the following provisions have effect: (a) the Commissioner shall serve notice of the notional assessment on: (i) where paragraph (3)(c) or subparagraph (4)(b)(ii), as the case may be, applies in relation to only one person in relation to recoupment tax that is vendors recoupment tax—that person; and (ii) in any other case—any of the persons referred to in paragraph (3)(c) or subparagraph (4)(b)(ii), as the case may be, in relation to recoupment tax that is vendors recoupment tax; and (b) where notice of the notional assessment is served in accordance with subparagraph (a)(ii)—the Commissioner shall serve a copy of the notice of the notional assessment on each person (other than the person on whom the notice of the notional assessment was served) who is included in the representative class in relation to the vendors recoupment tax referred to in subparagraph (a)(ii). (8) Where notice of the notional assessment and a copy or copies of that notice are served on persons under subsection (7), the Commissioner shall notify each of the persons of the identity of each of the other persons. (9) Where notice of the notional assessment is served under subsection (6) or (7): (a) if the notice was served under subsection (6) or subparagraph (7)(a)(i)—the person on whom the notice was served; and (b) if the notice was served under subparagraph (7)(a)(ii)—one person who: (i) is included in the representative class in relation to the recoupment tax referred to in paragraph (3)(c) or (4)(b), as the case may be, that is vendors recoupment tax; and (ii) is nominated, by notice signed by more than one‑half of the persons included in that class and lodged with the Commissioner; has the same rights under section 175A of the Assessment Act and Part IVC of the Taxation Administration Act 1953 in respect of the notional assessment as the company would have had if it had continued to exist and the notional assessment were an assessment of ordinary company tax or undistributed profits tax, as the case may be, payable by the company in relation to the relevant year of income and, for the purpose of the exercise of those rights by the person, the provisions of that Division apply in relation to notional assessment in like manner as those provisions apply in relation to an assessment under the Assessment Act. (10) For the purposes of this section, the following persons constitute the representative class in relation to vendors recoupment tax: (a) each person, not being a company, whose whereabouts is known to the Commissioner and in relation to whom the vendors recoupment tax is recoupment tax on a primary taxable amount; (b) each company (including a company in the capacity of trustee) that, in the opinion of the Commissioner, is carrying on business and in relation to which the vendors recoupment tax is recoupment tax on a primary taxable amount; and (c) the other persons referred to in subparagraph (7)(a)(ii) or, if those persons exceed 5 in number, 5 of those persons selected by the Commissioner as appropriate representatives of those persons. (11) For the purposes of this Act: (a) the notional assessment shall be treated as if it were an assessment made under the Assessment Act of ordinary company tax or undistributed profits tax, as the case may be, payable by the company in relation to the relevant year of income; and (b) the notional company tax that, at a particular time, is applicable in accordance with subsection (12) in relation to the company in relation to the relevant year of income by virtue of the notional assessment shall be treated as if it were an amount of ordinary company tax or undistributed profits tax, as the case may be, that has become due and payable by the company in relation to the relevant year of income and remains unpaid at that time. (12) For the purpose of ascertaining the notional company tax that is applicable, at a particular time, in relation to the company in relation to the relevant year of income by virtue of the notional assessment, the provisions of the Assessment Act apply in relation to the notional assessment and the notional ordinary company tax or notional undistributed profits tax, as the case may be, to which the notional assessment relates as if: (a) the notional assessment were an assessment of the ordinary company tax or undistributed profits tax, as the case may be, payable by the company in relation to the relevant year of income; and (b) the notional ordinary company tax or notional undistributed profits tax, as the case may be, were ordinary company tax or undistributed profits tax, as the case may be. (13) Without limiting the generality of subsection (12), sections 170 and 207 of the Assessment Act apply for the purpose of determining the notional company tax that is applicable, at a particular time, in relation to the company by virtue of the notional assessment. (14) Subsections 5(6) and 7(11) have effect for the purposes of subsection (1) of this section in like manner as those subsections have effect for the purposes of paragraphs 5(1)(c) and (2)(c), and paragraphs 7(1)(c) and (2)(c), respectively.