From 1 April 2011 changes to the qualifying and loss attributing company rules will come into effect.
The changes include:
- Providing transparent income tax rules through a new tax entity called a look-through company (LTC – refer overleaf) – shareholders of a closely
held company can elect for it to become an LTC. - Allowing existing qualifying companies (QC’s) and loss attributing qualifying companies (LAQCs) to continue to use the current QC rules but without the ability to attribute losses (pending a review of the dividend rules for closely held companies).
- Allowing existing QC’s and LAQC’s to transition to the new look-through company tax rules or change to another business option, such as a limited partnership, without a tax cost during the period 1 April 2011 to 31 March
2013.