Definition of a ‘Family’ or ‘Closely Controlled’ Company
24.A94. Estate and gift duty legislation in some Australian States and elsewhere seeks to define those companies (identified as ‘family’ or ‘closely controlled’ companies) which are likely to be used by a taxpayer or by a group of taxpayers to avoid or minimise their taxes, and to confine special provisions of the kind discussed in previous paragraphs to transactions involving such companies. These attempts have not achieved their purpose, and the Committee therefore proposes that its recommendations be applied to all companies. It believes that bona fide business transactions need not be prejudiced by its recommendations. In paragraph 24.A93 a specific provision is proposed in regard to ordinary commercial transactions. Specific provisions of this kind may also be helpful in other contexts involving companies: for example, in regard to a gift by allotment of shares.