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Designated Private Company
What is a designated private company?
- the company satisfies at least two of the following three sub-conditions in relation to the financial year ending immediately before the assessment period:
- the consolidated gross operating revenue for the financial year for the company and its subsidiaries is less than $25 million,
- the value of the consolidated gross assets at the end of the financial year of the company and its subsidiaries is less then $12.5 million,
- the company and its subsidiaries have fewer than 50 employees at the end of the financial year; or
- the company is a new company and came into existence after the end of the last financial year, or
- the company is a declared private company, and
- the company is not an excluded company.
Once it has been determined that the company is a designated private company, then the issue of who controls the assets and income of the company and the percentage of control to be attributed to the individual(s) can be decided.More ?
Non-designated private companies
Non-designated private companies are assessed under the pre 1 January 2002 private company rules.More ?
Assessing the Income & Assets from Private Companies pre 01/01/2002
Legislation Library - Commission Determinations
Company has the same meaning as in the Income Tax Assessment Act 1997.
According to Section 52ZZA of the VEA, a company is a designated private company at a particular time if the company:
- satisfies at least 2 of the following conditions in relation to the financial year that ended immediately before that time:
gross operating revenue is less than $25 million;
gross assets at the end of the financial year are less than $12.5 million;
the company has fewer than 50 employees at the end of the financial year, or
- the company came into existence after the end of the financial year that ended immediately preceding that time, or
- the company is a declared private company (DPC) ,
and the company is not an excluded company.
Financial year, in relation to a company, means:
- a period of 12 months beginning on 1 July, or
- if some other period is the company's tax year that other period.
An excluded company is a company declared in writing by Commission to be excluded from the private trust and company provisions.
Control includes control as a result of, or by means of, trusts, agreements, arrangements, understandings and practices, whether or not having legal or equitable force and whether or not based on legal or equitable rights.