Substitute Accounting Period

 Author: AriATO(Community Support)Community Support

8 Apr 2025

Hi @punitshah

Generally, a loan where Division 7A applies is deemed to be paid at the end of the income year of the company in which the payment loan took place. Where a private company has a substituted accounting period and the shareholder has adopted the normal income year ending 30 June, the deemed dividend would be deemed to have been paid to the shareholder on the end date of the substituted accounting period, even if it may have actually been paid to the shareholder at much earlier date.

Moreover, if a private company that has made a Div7A loan has adopted a substituted accounting period, the applicable benchmark interest rate is the rate last published by the Reserve Bank of Australia before the start of the private company's substituted accounting period.

See Entities with a substituted accounting period for more info.

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