QUESTION 14

1. In relation to the application of Division 7A of the ITAA36, which of the following is incorrect?

   		The amount of the deemed dividend is limited to the companys distributable surplus
   		The deemed dividend is subject to withholding tax
   		The recipient is deemed to receive a dividend which is assessable under section 44 of the ITAA 36
   		Division 7A applies in priority to FBT in respect to loans and debt forgiveness
   		The deemed dividend is not frankable