Income Tax Assessment Amendment (Capital Gains) Act 1986 (Cth)
Section
1. Short title, &c.
2. Commencement
3. Interpretation
4. Cost of certain shares
5. Money credited, reinvested, &c., to be deemed to be derived
6. Exemptions
7. Interpretation
8. Assessable income to include certain profits
9. Shares and rights acquired under scheme for the acquisition of shares by employees
10. Insertion of new section—
51aaa. Deductions not allowable in certain circumstances
11. Loss on property acquired for profit-making
12. Repeal of section and substitution of new section—
82kze. Carry forward of excess rental property loan interest
13. Transfer of excess rental property loan interest within company group
14. Repeal of section and substitution of new section—
82kzg. Special provision relating to partnerships
15. Exemption of income attributable to superannuation policies and certain annuities
16. Interpretation
17. Insertion of new section—
149a. Capital gains to be disregarded
18. Rebates for dependants
19. Insertion of new Part—
TABLE OF PROVISIONS—
Section
160a. Assets to which Part applies
160b. Personal-use assets
160c. Taxpayer
160d. Money or other property applied for benefit of taxpayer
160e. Associated persons
160f. Associated trust estates
160g. Related companies
160h. Resident trust estates, partnerships and unit trusts
160j. Asset passing to personal representative or beneficiary
160k. Other interpretative provisions
160l. Part applies in respect of disposals of assets
160m. What constitutes a disposal or acquisition
160n. Assets lost or destroyed
160p. Composite assets
160q. Indexation of indexed cost base limit
160r. Part disposals
160s. Transfers by way of security, &c.
160t. Disposal of taxable Australian assets
160u. Time of disposal and acquisition
160v. Disposals by bare trustees and persons enforcing securities
160w. Effect of bankruptcy, &c.
160x. Death not to constitute disposal, &c.
160y. Asset bequeathed to tax-exempt person
160z. Capital gains and capital losses
160za. Reductions of capital gains in certain circumstances
160zb. Exemption of certain gains and losses
160zc. Net capital gains and net capital losses
160zd. Consideration in respect of disposal
160ze. Consideration in respect of disposal of non-listed personal-use assets
160zf. Adjustment where consideration not received
160zg. Cost base, &c., of non-listed personal-use assets
160zh. Cost base, &c.
160zi. Apportionment of cost base upon disposal of part of asset
160zj. Indexation of amounts for purposes of indexed cost base
160zk. Reduction of amounts for purposes of reduced cost base
160zl. Return of capital on shares
160zm. Return of capital on investment in trust
160zn. Application to joint owners
160zo. Treatment of net capital gains and net capital losses
160zp. Transfer of net capital loss within company group
160zq. Treatment of gains and losses in respect of listed personal-use assets
160zr. Interpretation
160zs. Grant of lease to constitute disposal
160zt. Payments for variation of lease
160zu. Renewal or extension of lease
160zv. Consideration for disposal
160zw. Acquisition by lessee of reversionary interest of lessor
TABLE OF PROVISIONS—
Section
160zx. Person becoming entitled to beneficial ownership of trust asset
160zy. Dealing with right to receive income from trust
160zya. Transfer of asset in satisfaction of right to receive income from trust
160zyb. Dealing with interest in corpus of trust estate
160zyc. Application
160zyd. Time of acquisition of certain bonus units
160zye. Consideration in respect of acquisition
160zyf. Application
160zyg. Time of acquisition of bonus shares
160zyh. Consideration in respect of acquisition
160zyi. Consideration for acquisition of shares by employees
160zyj. Consideration for acquisition of share rights by employees
160zyk. Application
160zyl. Exercise of rights not to constitute disposal
160zym. Time of acquisition of rights
160zyn. Shareholder not to be deemed to have paid or given consideration for rights
160zyo. Exercise of rights
160zyp. Division to be subject to Division 9
160zyq. Application of Division to holders of convertible notes
160zyr. Application
160zys. Exercise of option not to constitute disposal
160zyt. Time of acquisition of option
160zyu. Shareholder not to be deemed to have paid or given consideration for option
160zyv. Exercise of option
160zyw. Division to be subject to Division 9
160zyx. Application of Division to holders of convertible notes
160zyy. Definition
160zyz. Conversion of note not to constitute disposal
160zz. Time of acquisition of shares
160zza. Consideration in respect of acquisition
160zzb. Division to be subject to Division 9
160zzc. Options
160zzd. Industrial property
TABLE OF PROVISIONS—
Section
160zze. Disposal of prospecting or mining right
160zzf. Conversion of prospecting right to mining right
160zzg. Disposal of right to receive income from mining operations
160zzh. Policies of insurance
160zzi. Policies of life assurance
160zzj. Superannuation and approved deposit funds
160zzk. Involuntary disposal
160zzl. Asset received as a result of involuntary disposal
160zzm. Transfer of asset between spouses upon breakdown of marriage
160zzn. Transfer of asset to wholly-owned company
160zzo. Transfer of asset between companies in the same group
160zzp. Exchange of shares in the same company
160zzq. Exemption of principal residence
160zzr. Exemption of part of gain attributable to goodwill
160zzs. When asset acquired
160zzt. Disposal of shares or interest in partnership or trust
160zzu. Keeping of records
20. Annual returns
21. Further returns, &c.
22. Amendment of assessments
23. Where no notice of assessment served
24. When tax not paid during lifetime
25. Consolidation assessments
26. Assessment where no administration
27. Interpretation
28. Amount of notional tax
29. Estimated income tax
30. Interpretation
31. Amount of provisional tax
32. Provisional tax on estimated income
33. Agents and trustees
34. Person in receipt or control of money from non-resident
35. Payment of tax by banker
[
BE IT ENACTED by the Queen, and the Senate and the House of Representatives of the Commonwealth of Australia, as follows:
(a) by inserting after the definition of “resident” or “resident of Australia” in sub-section (1) the following definition:
“ ‘return of income’ means a return of income, or of profits or gains of a capital nature, or of both income and such profits or gains;”; and
(b) by adding “or deriving profits or gains of a capital nature” at the end of the definition of “taxpayer” in sub-section (1).
“(b) where any of the original shares or any of the bonus shares are not articles of trading stock of the taxpayer—
(i) the amount or value of the consideration paid in respect of the acquisition of any of those shares for the purposes of Part IIIa; or
(ii) the amount of any profit or loss arising on the sale or disposal of any of those shares,”.
(a) by omitting from paragraph (q) “derived by a resident from sources out of Australia and Papua New Guinea, where that income is not exempt from income tax in the country where it is derived, or where the taxpayer is liable to pay royalty or export duty in any country outside Australia and Papua New Guinea in respect of goods from the sale of which the income is derived” and substituting “, or profits or gains of a capital nature, derived by a resident from sources out of Australia and Papua New Guinea, where that income is not, or those profits or gains are not, exempt from tax in the country where the income is, or the profits or gains are, derived, or where the taxpayer is liable to pay royalty or export duty in any country outside Australia and Papua New Guinea in respect of goods from the sale of which the income is, or the profits or gains are, derived”; and
(b) by omitting the proviso to paragraph (q) and substituting the following proviso:
“Provided that this paragraph does not apply to exempt any income, or any profits or gains of a capital nature, unless—
(i) where there is a liability for tax in the country where that income is, or those profits or gains are, derived—the Commissioner is satisfied that the tax has been or will be paid; or
(ii) where the outgoings incurred in producing that income or those profits or gains exceed that income or those profits or gains, as the case may be—the Commissioner is satisfied that the tax would have been paid in the country where the income is, or the profits or gains are, derived if the income, or the profits or gains, as the case may be, had exceeded the outgoings;”.
“(4) This Division applies in relation to profits or gains of a capital nature in the same manner as it applies in relation to income.”.
“(1a) This section does not apply in respect of the sale of property acquired on or after 20 September 1985.”.
(a) by inserting after sub-section (8) the following sub-sections:
“(8a) Where a taxpayer has acquired a right (whether that right was unconditional or was subject to conditions) to acquire a share in a company under a scheme for the acquisition of shares by employees, being a right issued after 19 September 1985, the taxpayer may elect that sub-section (8c) is to apply in relation to that right.
“(8b) An election under sub-section (8a) in relation to a right—
(a) shall be made by notice in writing addressed to the Commissioner; and
(b) does not have effect unless it is lodged with the Commissioner on or before the date of lodgment of the return of income of the taxpayer for the year of income in which the right was acquired, or before such later date as the Commissioner allows.
“(8c) Where a taxpayer has made an election under sub-section (8a) in relation to a right—
(a) the assessable income of the taxpayer of the year of income during which that right was issued to the taxpayer includes the value of that right at the time when it was issued to the taxpayer less the amount, if any, paid or payable by the taxpayer as consideration for the right;
(b) no amount shall be included in the assessable income of the taxpayer of any year of income in respect of that right by virtue of any other provision of this section; and
(c) no amount shall be included in the assessable income of the taxpayer of any year of income by virtue of sub-section (5) in respect of a share acquired by the taxpayer as a result of the exercise or operation of the right.
“(8d) Where—
(a) a taxpayer has made an election under sub-section (8a) in relation to a right;
(b) by virtue of paragraph (8c) (a), an amount has been included, or would, but for this sub-section, be included, in the assessable income of the taxpayer of a year of income in respect of that right; and
(c) by virtue of any conditions or restrictions (being conditions or restrictions applicable only to rights to acquire shares in the company acquired under a scheme for the acquisition of shares by employees) attached to, or to the issue of, the right, the taxpayer has been divested of ownership of the right,
then, notwithstanding paragraph (8c) (a), the assessable income of the taxpayer of the year of income referred to in paragraph (b) of this sub-section shall be deemed not to have included, or not to include, as the case may be, the amount referred to in that paragraph.”;
(b) by inserting after sub-section (11) the following sub-section:
“(11a) Sub-section (11) does not apply in relation to a disposition of a right to acquire a share in a company if Part IIIa applies in relation to that disposition.”;
(c) by inserting after sub-section (12) the following sub-section:
“(12a) Sub-section (12) does not apply in relation to a disposition of a share in a company if Part IIIa applies in relation to that disposition.”;
(d) by inserting after sub-section (13) the following sub-section:
“(13a) Sub-section (13) does not apply in relation to a disposition of a share in a company if Part IIIa applies in relation to that disposition.”;
(e) by inserting after sub-section (15) the following sub-sections:
“(15a) A taxpayer may elect that sub-section (15) is not to apply in relation to a share specified in the election, being a share issued to the taxpayer after 19 September 1985.
“(15b) An election under sub-section (15a) in relation to a share—
(a) shall be made by notice in writing addressed to the Commissioner; and
(b) does not have any effect unless it is lodged with the Commissioner on or before the date of lodgment of the return of income of the taxpayer for the year of income in which the share was issued, or within such further period as the Commissioner allows.
“(15c) Where—
(a) a taxpayer has made an election under sub-section (15a) in relation to a share;
(b) by virtue of sub-section (5), an amount has been included, or would, but for this sub-section, be included, in the assessable income of the taxpayer of a year of income in respect of that share; and
(c) by virtue of any conditions or restrictions mentioned in paragraph (15) (b) attached to, or to the issue of, the share, the taxpayer has been divested of ownership of the share,
then, notwithstanding sub-section (5), the assessable income of the taxpayer of the year of income referred to in paragraph (b) of this sub-section shall be deemed not to have included, or not to include, as the case may be, the amount referred to in that paragraph.”; and
(f) by adding at the end the following sub-sections:
“(18) For the purposes of this section, in determining the value of a share or of a right to acquire a share, the share or the right, and any share that may be acquired as a consequence of the exercise or operation of the right, shall be deemed not to be subject to any conditions or restrictions (being conditions or restrictions applicable only to shares in, or rights to acquire shares in, the company acquired under a scheme for the acquisition of shares by employees).
“(19) Nothing in section 170 prevents the amendment of an assessment made in relation to a taxpayer if the amendment is made for the purpose of giving effect to sub-section (8d) or (15c) and effects a reduction in the liability of the taxpayer.”.
“51aaa. Where—
(a) an amount is included in the assessable income of a taxpayer of a year of income by section 160zo;
(b) a deduction would, but for this section, be allowable under this Subdivision to the taxpayer; and
(c) if the amount had not been included in the assessable income the deduction would not be allowable,
the deduction is not allowable.”.
“(1a) This section does not apply in respect of the sale of property acquired on or after 20 September 1985.”.
“82kze. Where the rental property loan interest of the taxpayer in relation to a year of income exceeds the sum of—
(a) the amount (if any) of the deduction allowable to the taxpayer under section 51 in the year of income in respect of that rental property loan interest; and
(b) the amount (if any) by which a capital gain or capital gains that, but for sub-section 160za (1), would be deemed by Part IIIa to have accrued to the taxpayer during the year of income in respect of the disposal of a prescribed asset or prescribed assets (within the meaning of section 160za) is reduced by virtue of sub-section 160za (1),
the excess amount shall, for the purposes of section 51, this Subdivision and Part IIIa, be deemed to have been incurred by the taxpayer at the beginning of the next succeeding year of income.”.
(a) by omitting paragraph (1) (a) and substituting the following paragraph:
“(a) the rental property loan interest of a company that is a resident (in this section referred to as the ‘transferor’) in relation to a year of income exceeds the sum of—
(i) the amount (if any) of the deduction allowable to the transferor under section 51 in the year of income in respect of that rental property loan interest; and
(ii) the amount (if any) by which a capital gain or capital gains that, but for sub-section 160za (1), would be deemed by Part IIIA to have accrued to the transferor during the year of income in respect of the disposal of a prescribed asset or prescribed assets (within the meaning of section 160za) is reduced by virtue of sub-section 160za (1); and”;
(b) by omitting from sub-section (1) “and this Subdivision” and substituting “, this Subdivision and Part IIIa”; and
(c) by omitting from sub-section (3) “the rental property income of the transferee of that year of income” and substituting “the sum of the rental property income of the transferee of that year of income and the amount (if any) of the capital gain or capital gains that, but for sub-section 160za(1), would be deemed by Part IIIa to have accrued to the transferee during the year of income in respect of the disposal of a prescribed asset or prescribed assets (within the meaning of section 160za)”.
“82kzg. Section 82kze does not apply in relation to a taxpayer being a partnership but, where the rental property loan interest of the partnership in relation to a year of income exceeds the sum of—
(a) the amount (if any) of the deduction allowable to the partnership under section 51 in relation to the year of income in respect of that rental property loan interest; and
(b) the amount (if any) by which a capital gain or capital gains that, but for sub-section 160za (1), would be deemed by Part IIIa to have accrued to the partnership in respect of the disposal of a prescribed asset or prescribed assets (within the meaning of section 160za) during the year of income is reduced by virtue of sub-section 160za (1),
each partner in the partnership shall be deemed, for the purposes of section 51, this Subdivision and Part IIIa, to have incurred—
(c) in a case where the year of income is the transitional year of income—in that year of income and immediately after the commencement date; and
(d) in any other case—at the beginning of the year of income,
in gaining or producing assessable income, rental property loan interest equal to the partner’s portion of the excess.”.
“(1a) The reference in sub-section (1) to an amount of income derived during the year of income from the assets included in an Australian statutory fund of a life assurance company or in any other fund maintained by such a company in respect of the life assurance business of the company shall be construed as including a reference to an amount of a capital gain that is to be taken for the purposes of Part IIIa to have accrued to the company
during the year of income as a result of the disposal of an asset included in such a fund.”.
“(c) section 112a;
(ca) sub-section 160z (8); and”.
“149a. (1) For the purposes of the application of this Division in relation to a taxpayer (including the purpose of determining whether this Division applies to the income of a taxpayer), references in this Division to the assessable income or taxable income of the taxpayer of any year of income shall be read as references to the respective amounts (if any) that would have been the assessable income and taxable income of the taxpayer of that year of income but for section 160zo.
“(2) A reference in sub-section (1) to the assessable income or taxable income of a taxpayer of a year of income shall, in relation to a taxpayer in the capacity of trustee of a trust estate, be read as a reference to the assessable income or net income, as the case may be, of the trust estate of the year of income.”.
“(aa) includes any amount that is included in the assessable income of the dependant by Part IIIa;”.
“160a. In this Part, unless the contrary intention appears, ‘asset’ means any form of property and includes—
(a) an option, a debt, a chose in action, any other right, goodwill and any other form of incorporeal property;
(b) currency of a foreign country; and
(c) any form of property created or constructed, or otherwise coming to be owned without being acquired,
but does not include a motor vehicle of a kind mentioned in paragraph 82af (2) (a).
“160b. (1) For the purposes of this Part, ‘personal-use asset’, in relation to a taxpayer, means—
(a) an asset (other than land, or a building that is deemed to be a separate asset from land by virtue of section 160p) owned by the taxpayer and used or kept primarily for the personal use or enjoyment of the taxpayer, of an associate or associates of the taxpayer or of the taxpayer and any one or more of the associates of the taxpayer;
(b) a debt owed to the taxpayer—
(i) in respect of an asset that was formerly a personal-use asset of the taxpayer; or
(ii) that came to be owed otherwise than in the course of the gaining or producing of income by the taxpayer or the carrying on of a business by the taxpayer; and
(c) an option or right of the taxpayer to acquire an asset that would, if acquired by the taxpayer, be an asset to which paragraph (a) would apply.
“(2) For the purposes of this Part, ‘listed personal-use asset’, in relation to a taxpayer, means a personal-use asset of the taxpayer the consideration in respect of the acquisition of which by the taxpayer exceeded $100 and which is—
(a) any of the following:
(i) a print, etching, drawing, painting, sculpture or other similar work of art;
(ii) jewellery;
(iii) a rare folio, rare manuscript or rare book;
(iv) a postage stamp or first day cover;
(v) a coin or medallion;
(vi) an antique;
(vii) an interest in an asset referred to in any of the preceding sub-paragraphs;
(b) a debt owed in respect of an asset referred to in paragraph (a); or
(c) an option or right to acquire an asset referred to in paragraph (a).
“(3) For the purposes of this Part, ‘non-listed personal-use asset’ means a personal-use asset other than a listed personal-use asset.
“(4) Where—
(a) a taxpayer owned two or more articles being non-listed personal-use assets of a kind that would not ordinarily be disposed of otherwise than by one transaction as a set of articles; and
(b) the taxpayer has disposed of the articles by two or more transactions, whether the articles were disposed of to the same person or to different persons,
this Part applies, and shall be deemed to have applied, as if the articles constituted a single non-listed personal-use asset and as if each disposal were a disposal of part of that asset.
“(5) Sub-section (4) does not apply if the disposal of the articles by several transactions instead of a single transaction was effected solely for a reason or reasons unrelated to the operation of this Part.
“(6) Nothing in section 170 prevents the amendment of an assessment for the purpose of giving effect to sub-section (4).
“160c. (1) A reference in this Part to a taxpayer, in relation to an asset that has been disposed of or in relation to a capital gain or listed personal-use asset gain that accrued or a capital loss or a listed personal-use asset loss that was incurred in respect of such an asset, is a reference—
(a) except where paragraph (b) applies—to the person who owned the asset immediately before the disposal took place; or
(b) where the disposal resulted from an act that is, by virtue of sub-section 160V (1) or section 160w, deemed to be the act of a person other than the person who owned the asset immediately before the disposal took place—to that other person.
“(2) A reference in this Part to a taxpayer, in relation to an asset that has been acquired, is a reference to the person who owned the asset immediately after the acquisition took place.
“160d. (1) For the purposes of this Part—
(a) a taxpayer shall be deemed to have received money or other property if the money or other property has been applied for the benefit, or in accordance with the directions, of the taxpayer; and
(b) a taxpayer shall be deemed to be entitled to receive money or other property if the taxpayer is entitled to have the money or other property applied for the benefit, or in accordance with the directions, of the taxpayer.
“(2) For the purposes of this Part, a reference in sub-section (1) to the application of money or other property for the benefit of a taxpayer includes, without limiting the generality of the expression, a reference to the application of money or other property in the discharge, in whole or in part, of a debt due by the taxpayer.
“(3) Nothing in this section limits the operation of section 19.
“160e. A reference in this Part to an associate of a taxpayer is a reference to—
(a) in the case of a taxpayer who is a natural person, other than a taxpayer in the capacity of a trustee—
(i) a relative of the taxpayer;
(ii) a partner of the taxpayer;
(iii) if a person who is an associate of the taxpayer by virtue of sub-paragraph (ii) is a natural person—the spouse or a child of that person;
(iv) a trustee of a trust estate where the taxpayer or another person who is an associate of the taxpayer by virtue of another sub-paragraph of this paragraph benefits or is capable (whether by the exercise of a power of appointment or otherwise) of benefiting under the trust, either directly or through any interposed companies, partnerships or trusts; or
(v) a company where—
(a) the company is, or its directors are, accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of the taxpayer, of another person who is an associate of the taxpayer by virtue of another sub-paragraph of this paragraph, of a company that is an associate of the taxpayer by virtue of another application of this sub-paragraph or of any two or more such persons; or
(b) the taxpayer is, the persons who are associates of the taxpayer by virtue of sub-sub-paragraph (a) of this sub-paragraph and the preceding sub-paragraphs of this paragraph are, or the taxpayer and the persons who are associates of the taxpayer by virtue of that sub-sub-paragraph and those sub-paragraphs are, in a position to cast, or control the casting of, more than 50% of the maximum number of votes that might be cast at a general meeting of the company;
(b) in the case of a taxpayer being a company, other than a taxpayer in the capacity of a trustee—
(i) a partner of the taxpayer;
(ii) if a person who is an associate of the taxpayer by virtue of sub-paragraph (i) is a natural person—the spouse or a child of that person;
(iii) a trustee of a trust estate where the taxpayer or another person who is an associate of the taxpayer by virtue of another sub-paragraph of this paragraph benefits or is capable
(whether by the exercise of a power of appointment or otherwise) of benefiting under the trust, either directly or through any interposed companies, partnerships or trusts;
(iv) another person where—
(a) the taxpayer company is, or its directors are, accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of that person, or of that person and another person or other persons, whether those directions, instructions or wishes are communicated directly to the taxpayer company or its directors, or through any interposed companies, partnerships or trusts; or
(b) that person is, or that person and the persons who, if that person were the taxpayer, would be associates of that person by virtue of paragraph (a), by virtue of sub-sub-paragraph (a) of this sub-paragraph, by virtue of another sub-paragraph of this paragraph or by virtue of paragraph (c) are, in a position to cast, or control the casting of, more than 50% of the maximum number of votes that might be cast at a general meeting of the taxpayer company;
(v) another company where—
(a) the other company is, or its directors are, accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of the taxpayer company, of a person who is an associate of the taxpayer company by virtue of another sub-paragraph of this paragraph, of a company that is an associate of the taxpayer company by virtue of another application of this sub-paragraph or of any two or more such persons; or
(b) the taxpayer company is, the persons who are associates of the taxpayer company by virtue of sub-sub-paragraph (a) of this sub-paragraph and the other sub-paragraphs of this paragraph are, or the taxpayer company and the persons who are associates of the taxpayer company by virtue of that sub-sub-paragraph and those sub-paragraphs are, in a position to cast, or control the casting of, more than 50% of the maximum number of votes that might be cast at a general meeting of the other company; or
(vi) any other person who, if a third person who is an associate of the taxpayer company by virtue of sub-paragraph (iv) were the taxpayer, would be an associate of that third person
by virtue of paragraph (a), by virtue of another sub-paragraph of this paragraph or by virtue of paragraph (c);
(c) in the case of a taxpayer in the capacity of a trustee of a trust estate—
(i) any person who benefits or is capable (whether by the exercise of a power of appointment or otherwise) of benefiting under the trust estate, either directly or through any interposed companies, partnerships or trusts;
(ii) where a person who is an associate of the taxpayer by virtue of sub-paragraph (i) is a natural person—any person who, if that natural person were the taxpayer, would be an associate of that natural person by virtue of paragraph (a) or this paragraph; or
(iii) where a person who is an associate of the taxpayer by virtue of sub-paragraph (i) or (ii) is a company—any person who, if that company were the taxpayer, would be an associate of that company by virtue of paragraph (b) or this paragraph; or
(d) in the case of a taxpayer being a partnership—
(i) a partner in the partnership;
(ii) where any partner in the partnership is a natural person— any person who, if that natural person were the taxpayer, would be an associate of that natural person by virtue of paragraph (a) or (c); or
(iii) where any partner in the partnership is a company—any person who, if the company were the taxpayer, would be an associate of the company by virtue of paragraph (b) or (c).
“160f. (1) For the purposes of this Part, a trust estate is associated with another trust estate if a person who benefits or is capable of benefiting from the first-mentioned trust estate benefits or is capable of benefiting from the other trust estate.
“(2) For the purposes of this Part, trust estates that are associated with the same trust estate (including trust estates that are so associated by another application or other applications of this sub-section) are associated with each other.
“160g. (1) For the purposes of this Part, a company shall be taken to be related to another company if—
(a) one of the companies is a subsidiary of the other company; or
(b) each of the companies is a subsidiary of the same company.
“(2) For the purposes of this section, a company (in this sub-section referred to as the ‘subsidiary company’) shall be taken to be the subsidiary
of another company (in this sub-section referred to as the ‘holding company’) if—
(a) all the shares in the subsidiary company are beneficially owned by—
(i) the holding company;
(ii) a company that is, or two or more companies each of which is, a subsidiary of the holding company; or
(iii) the holding company and a company that is, or two or more companies each of which is, a subsidiary of the holding company; and
(b) no person is in a position to affect rights of the holding company or of a subsidiary of the holding company in relation to the subsidiary company.
“(3) For the purposes of this section, where a company is a subsidiary of another company (including a company that is such a subsidiary by virtue of another application or other applications of this sub-section), every company that is a subsidiary of the first-mentioned company shall be taken to be a subsidiary of that other company.
“(4) For the purposes of sub-section (2), a person shall be taken to be in a position to affect any rights of a company in relation to another company if that person has a right, power or option (whether by virtue of any provision in the constituent document of either of those companies, by virtue of any agreement or otherwise) to acquire those rights or do an act or thing that would prevent the first-mentioned company from exercising those rights for its own benefit or receiving any benefits accruing by reason of those rights.
“(5) In sub-section (4), ‘agreement’ means an agreement, arrangement or understanding, whether formal or informal, whether express or implied and whether or not enforceable, or intended to be enforceable, by legal proceedings.
“160h. (1) For the purposes of this Part, a trust estate shall be taken to be a resident trust estate in relation to the year of income if—
(a) a trustee of the trust estate was a resident at any time during the year of income; or
(b) the central management and control of the trust estate was in Australia at any time during the year of income.
“(2) For the purposes of this Part, a partnership shall be taken to be a resident partnership in relation to the year of income if—
(a) a partner in the partnership was a resident at any time during the year of income; or
(b) the central management and control of the business or of the principal business of the partnership was in Australia at any time during the year of income.
“(3) For the purposes of this Part, a unit trust shall be taken to be a resident unit trust in relation to the year of income if, at any time during the year of income—
(a) either of the following conditions was satisfied:
(i) any property of the unit trust was situated in Australia;
(ii) the trustee of the unit trust carried on business in Australia; and
(b) either of the following conditions was satisfied:
(i) the central management and control of the unit trust was in Australia;
(ii) a person who was a resident or persons who were residents held more than 50% of—
(a) the beneficial interests in the income of the unit trust; or
(b) the beneficial interests in the property of the unit trust.
“160j. In this Part—
(a) a reference to an asset that formed part of the estate of a deceased person passing to the legal personal representative of the deceased person is a reference to an asset that formed part of the estate of a deceased person coming into the ownership of a person as the executor of the will, or as the administrator of the estate, of the deceased person; and
(b) a reference to an asset that formed part of the estate of a deceased person passing to a beneficiary in that estate is a reference to an asset that formed part of the estate of the deceased person coming into the ownership of a person as a beneficiary—
(i) under the will of the deceased person, or under that will as varied by an order of a court; or
(ii) by operation of law as a result of the intestacy of the deceased person, or by operation of law as a result of that intestacy as the operation of the law is varied by an order of a court,
whether the asset was transmitted directly to that person or was transferred to that person by the executor of the will, or by the administrator of the estate, of the deceased person.
“160k. (1) In this Part, unless the contrary intention appears—
‘building’ includes a structure;
‘land’ includes—
(a) a legal or equitable estate or interest in land;
(b) a right, power or privilege over, or in connection with, land;
(c) a legal or equitable estate or interest in a stratum unit; or
(d) a share in a company that owns land on which a building is erected, being a share that entitles the holder to a right of occupancy of a dwelling of a kind known as a flat or home unit contained in the building;
‘relevant exempting provision’ means any of the following provisions:
(a) paragraphs 23 (d), (e), (ea), (eb), (ec), (f), (g), (h), (i), (j), (jaa), (ja) and (x);
(b) section 23f, 23fa or 23fb;
(c) any provision of an Act other than this Act to the effect that income of a particular person or body is not subject to taxation under any law of the Commonwealth or to the effect that a particular person or body is not subject to taxation under any law of the Commonwealth;
‘stratum unit’ means a unit on a unit plan registered under a law of a State or Territory that provides for the registration of titles of a kind known as unit titles or strata titles, being a unit that comprises—
(a) a part of a building containing a dwelling, being a part consisting of a flat or home unit; or
(b) a part of a parcel of land, being a part on which a building containing the dwelling is constructed;
‘transfer’ includes conveyance;
‘will’ includes a codicil.
“(2) In this Part other than section 160zzm, or in a provision of this Act other than this Part in so far as that provision has effect for the purposes of this Part—
(a) a reference to the spouse of a person (in this paragraph referred to as the ‘relevant person’)—
(i) includes a reference to a de facto spouse of the relevant person; but
(ii) does not include a reference to a person who is legally married to the relevant person but is living separately and apart from the relevant person on a permanent basis; and
(b) a reference to the de facto spouse of a person (in this paragraph referred to as the ‘relevant person’) is a reference to a person who is living with the relevant person as the husband or wife of the relevant person on a
bona fide domestic basis although not legally married to the relevant person.
“(3) A reference in this Part to a person being entitled to receive money or property other than money includes a reference to a person being entitled to receive money or property other than money either immediately or at a future date and, in the case of money, either in a lump sum or by instalments.
“(4) A reference in this Part to a person being required to pay money or give property other than money includes a reference to a person being required to pay money or give property other than money either immediately or at a future date and, in the case of money, either in a lump sum or by instalments.
“(5)Where an amount of money, or the value of any property, that is to be taken into account for the purposes of this Part as, or as part of—
(a) the cost base to a taxpayer in respect of an asset; or
(b) the consideration in respect of the disposal of an asset,
would, but for this sub-section, be an amount in the currency of a foreign country, the amount to be so taken into account is the equivalent amount in Australian currency at the time when the costs were incurred or the time of disposal of the asset, as the case may be.
“(6) Where by virtue of a provision of this Part a taxpayer is deemed for the purposes of this Part to have paid or given any consideration in respect of the acquisition of an asset, the taxpayer shall be deemed, unless the contrary intention appears, to have paid or given that consideration at the time when the taxpayer acquired the asset.
“(7) Where a provision of this Part refers to a person who did not pay or give any consideration in respect of the acquisition of an asset, a person shall not be taken by reason of sub-section 160zh (9)not to be a person to whom the provision applies.
“(8) Where a provision of this Part refers to a person who did not receive any consideration in respect of the disposal of an asset, a person shall not be taken by reason of sub-section 160zd (2) not to be a person to whom the provision applies.
“(9) A provision of this Part that provides that this Part does not apply in respect of a disposal of an asset has effect only in relation to the person disposing of the asset and does not have effect in relation to the person who acquired the asset as a result of the disposal.
“(10) In this Part, unless the contrary intention appears, a reference to the trustee of a trust estate includes a reference to the trustee of a unit trust.
“160l. (1) Subject to this section, this Part applies in respect of every disposal on or after 20 September 1985 of an asset, whether situated in Australia or elsewhere, that—
(a) immediately before the disposal took place, was owned by—
(i) a person (not being a person in the capacity of a trustee) who was a resident of Australia; or
(ii) a person in the capacity of a trustee of a resident trust estate or of a resident unit trust; and
(b) was acquired by that person on or after 20 September 1985.
“(2) Subject to this section, this Part also applies in respect of every disposal on or after 20 September 1985 of a taxable Australian asset that—
(a) immediately before the disposal took place, was owned by—
(i) a person (not being a person in the capacity of a trustee) who was not a resident of Australia; or
(ii) a person in the capacity of a trustee of a trust estate that was not a resident trust estate or of a unit trust that was not a resident unit trust; and
(b) was acquired by that person on or after 20 September 1985.
“(3) This Part does not apply in respect of a disposal of an asset, not being an asset referred to in sub-section (4) or (5), if—
(a) immediately before its disposal the asset constituted trading stock of the taxpayer for the purposes of this Act;
(b) as a result of the disposal an amount has been or will be included in the assessable income of the taxpayer of any year of income by virtue of section 26aaa; or
(c) as a result of the disposal an amount has been or will be, or but for section 23h would have been or would be, included in the assessable income of the taxpayer of any year of income by virtue of section 26ag.
“(4) This Part does not apply in respect of a disposal of an asset, being an asset which was owned by a taxpayer in the capacity of a trustee of a trust estate and to which a beneficiary was absolutely entitled immediately before the disposal, if—
(a) immediately before its disposal, the asset constituted trading stock of the trustee for the purposes of this Act;
(b) as a result of the disposal an amount has been or will be included in the assessable income of the beneficiary, or the net income of the trust estate, of any year of income by virtue of section 26aaa; or
(c) as a result of the disposal an amount has been or will be, or but for section 23h would have been or would be, included in the assessable income of the beneficiary, or the net income of the trust estate, of any year of income by virtue of section 26ag.
“(5) This Part does not apply in respect of a disposal of an asset of a partnership if—
(a) immediately before its disposal, the asset constituted trading stock of the partnership for the purposes of this Act;
(b) as a result of the disposal an amount has been or will be included in the net income of the partnership, or in the assessable income of a partner in the partnership, or taken into account in ascertaining
the amount of the partnership loss, of any year of income by virtue of section 26aaa; or
(c) as a result of the disposal an amount has been or will be, or but for section 23h would have been or would be, included in the net income of the partnership, or in the assessable income of a partner in the partnership, or taken into account in ascertaining the amount of the partnership loss, of any year of income by virtue of section 26ag.
“(6) This Part does not apply in respect of a disposal of a decoration awarded for valour or brave conduct if the person disposing of the decoration did not pay or give any consideration in respect of his or her acquisition of the decoration.
“(7) This Part does not apply in respect of a disposal being a sale, transfer or assignment of rights to mine if paragraph 23 (pa) applies in relation to the sale, transfer or assignment.
“160m. (1) Subject to this Part, where a change has occurred in the ownership of an asset, the change shall be deemed, for the purposes of this Part, to have effected a disposal of the asset by the person who owned it immediately before the change and an acquisition of the asset by the person who owned it immediately after the change.
“(2) A reference in sub-section (1) to a change in the ownership of an asset is a reference to a change that has occurred in any way, including any of the following ways:
(a) by the execution of an instrument;
(b) by the entering into of a transaction;
(c) by the transmission of the asset by operation of law;
(d) by the delivery of the asset;
(e) by the doing of any other act or thing;
(f) by the occurrence of any event.
“(3) Without limiting the generality of sub-section (2), a change shall be taken to have occurred in the ownership of an asset by—
(a) a declaration of trust in relation to the asset under which the beneficiary is absolutely entitled to the asset as against the trustee;
(b) in the case of an asset being a debt, a chose in action or any other right, or an interest or right in or over property—the cancellation, release, discharge, satisfaction, surrender, forfeiture, expiry or abandonment, at law or in equity, of the asset;
(c) in the case of an asset being a share in or debenture of a company— the redemption in whole or in part, or the cancellation, of the share or debenture; or
(d) subject to sub-section (4), a transaction in relation to the asset under which the use and enjoyment of the asset was or is obtained
by a person for a period at the end of which the title to the asset will or may pass to that person.
“(4) A change shall not be taken to have occurred in the ownership of an asset by a transaction referred to in paragraph (3) (d) if the period for which the person referred to in that paragraph has the use and enjoyment of the asset terminates without the title to the asset passing to that person and nothing in section 170 prevents the amendment of an assessment for the purpose of giving effect to this sub-section.
“(5) For the purposes of this Part—
(a) an issue or allotment of shares in a company constitutes an acquisition of the shares by the person to whom they were issued or allotted but does not constitute a disposal of the shares by the company;
(b) the construction of an asset by or for a person constitutes the acquisition of the asset by the person; and
(c) the creation of an asset by or for a person constitutes the acquisition of the asset by the person.
“(6) A disposal of an asset that did not exist (either by itself or as part of another asset) before the disposal, but is created by the disposal, constitutes a disposal of the asset for the purposes of this Part, but the person who so disposes of the asset shall be deemed not to have paid or given any consideration, or incurred any costs or expenditure, referred to in paragraph 160zh (1) (a), (b), (c) or (d), (2) (a), (b), (c) or (d) or (3) (a), (b), (c) or (d) in respect of the asset.
“(7) Without limiting the generality of sub-section (2) but subject to the other provisions of this Part, where—
(a) an act or transaction has taken place in relation to an asset or an event affecting an asset has occurred; and
(b) a person has received, or is entitled to receive, an amount of money or other consideration by reason of the act, transaction or event (whether or not any asset was or will be acquired by the person paying the money or giving the other consideration) including, but not limited to, an amount of money or other consideration—
(i) in the case of an asset being a right—in return for forfeiture or surrender of the right or for refraining from exercising the right; or
(ii) for use or exploitation of the asset,
the act, transaction or event constitutes a disposal by the person who received, or is entitled to receive, the money or other consideration of an asset created by the disposal and, for the purposes of the application of this Part in relation to that disposal—
(c) the money or other consideration constitutes the consideration in respect of the disposal; and
(d) the person shall be deemed not to have paid or given any consideration, or incurred any costs or expenditure, referred to in
paragraph 160zh (1) (a), (b), (c) or (d), (2) (a), (b), (c) or (d) or (3) (a), (b), (c) or (d) in respect of the asset.
“(8) Where a taxpayer, being a resident, has, on or after 20 September 1985, ceased to be a resident, the taxpayer shall be deemed for the purposes of this Part—
(a) to have, at the time when the taxpayer ceased to be a resident (in this sub-section referred to as the ‘relevant time’), disposed of every asset that was owned by the taxpayer immediately before the relevant time, other than—
(i) a taxable Australian asset;
(ii) any other asset that was acquired by the taxpayer before 20 September 1985; or
(iii) an asset to which sub-section (9), (10) or (11) applies; and
(b) to have so disposed of every such asset for a consideration equal to the market value of the asset at the relevant time.
“(9) Where a resident trust estate has, on or after 20 September 1985, ceased to be a resident trust estate, the trustee of the trust estate shall be deemed for the purposes of this Part—
(a) to have, at the time when the resident trust estate ceased to be a resident trust estate (in this sub-section referred to as the ‘relevant time’), disposed of every asset that was, immediately before the relevant time, owned by the trustee as a trustee of that trust estate, other than—
(i) a taxable Australian asset; or
(ii) any other asset that was acquired by the trustee before 20 September 1985; and
(b) to have so disposed of every such asset for a consideration equal to the market value of the asset at the relevant time.
“(10) Where a resident unit trust has, on or after 20 September 1985, ceased to be a resident unit trust, the trustee of the unit trust shall be deemed for the purposes of this Part—
(a) to have, at the time when the resident unit trust ceased to be a resident unit trust (in this sub-section referred to as the ‘relevant time’), disposed of every asset that was, immediately before the relevant time, owned by the trustee as a trustee of that unit trust, other than—
(i) a taxable Australian asset; or
(ii) any other asset that was acquired by the trustee before 20 September 1985; and
(b) to have so disposed of every such asset for a consideration equal to the market value of the asset at the relevant time.
“(11) Where a resident partnership has, on or after 20 September 1985, ceased to be a resident partnership, the partners in the partnership shall be deemed for the purposes of this Part—
(a) to have, at the time when the partnership ceased to be a resident partnership (in this sub-section referred to as the ‘relevant time’), disposed of every asset that was owned by the partners in the partnership, and was the property of the partnership, immediately before the relevant time, other than—
(i) a taxable Australian asset; or
(ii) any other asset that was acquired by the partners before 20 September 1985; and
(b) to have so disposed of every such asset for a consideration equal to the market value of the asset at the relevant time.
“(12) Where a taxpayer, being a non-resident, has, on or after 20 September 1985, become a resident, every asset that was owned by the taxpayer immediately before the time when the taxpayer became a resident (in this sub-section referred to as the ‘relevant time’), other than—
(a) a taxable Australian asset;
(b) any other asset that was acquired by the taxpayer before 20 September 1985; or
(c) an asset to which sub-section (13), (14) or (15) applies,
shall be deemed for the purposes of this Part to have been acquired by the taxpayer at the relevant time and to have been so acquired for a consideration equal to the market value of the asset at the relevant time.
“(13) Where a trust estate, other than a resident trust estate, has, on or after 20 September 1985, become a resident trust estate, every asset that was, immediately before the time when the trust estate became a resident trust estate (in this sub-section referred to as the ‘relevant time’), owned by the trustee as a trustee of that trust estate, other than—
(a) a taxable Australian asset; or
(b) any other asset that was acquired by the trustee before 20 September 1985,
shall be deemed for the purposes of this Part to have been acquired by the trustee as the trustee of that trust estate at the relevant time and to have been so acquired for a consideration equal to the market value of the asset at the relevant time.
“(14) Where a unit trust, other than a resident unit trust, has, on or after 20 September 1985, become a resident unit trust, every asset that was, immediately before the time when the unit trust became a resident unit trust (in this sub-section referred to as the ‘relevant time’), owned by the trustee as a trustee of that unit trust, other than—
(a) a taxable Australian asset; or
(b) any other asset that was acquired by the trustee before 20 September 1985,
shall be deemed for the purposes of this Part to have been acquired by the trustee as the trustee of that unit trust at the relevant time and to have
been so acquired for a consideration equal to the market value of the asset at the relevant time.
“(15) Where a partnership, other than a resident partnership, has, on or after 20 September 1985, become a resident partnership, every asset that was owned by the partners in the partnership, and was the property of the partnership, immediately before the time when the partnership became a resident partnership (in this sub-section referred to as the ‘relevant time’), other than—
(a) a taxable Australian asset; or
(b) any other asset that was acquired by the partners before 20 September 1985,
shall be deemed for the purposes of this Part to have been acquired by the partners as property of the partnership and to have been so acquired for a consideration equal to the market value of the asset at the relevant time.
“160n. For the purposes of this Part but subject to the other provisions of this Part—
(a) the entire loss or destruction of an asset constitutes a disposal of the asset; and
(b) the loss or destruction of part of an asset constitutes a disposal of that part of the asset,
whether or not any amount of money or other consideration by way of compensation or otherwise is received as a result of or in respect of the loss or destruction.
“160p. (1) Where—
(a) land on which a building is erected was acquired by a taxpayer before 20 September 1985;
(b) after the acquisition of the land by the taxpayer the building was demolished and a new building was constructed on the land in replacement of the demolished building; and
(c) if the new building were a separate asset from the land, the new building would be taken for the purposes of this Part to have been acquired by the taxpayer on or after 20 September 1985,
the new building shall be deemed for the purposes of this Part to be an asset separate from the land.
“(2) Where—
(a) land was acquired by a taxpayer before 20 September 1985;
(b) after the acquisition of the land by the taxpayer a building was constructed on the land; and
(c) if the building were a separate asset from the land, the building would be taken for the purposes of this Part to have been acquired by the taxpayer on or after 20 September 1985,
the building shall be deemed for the purposes of this Part to be an asset separate from the land.
“(3) Where—
(a) land was acquired by a taxpayer before 20 September 1985; and
(b) on or after that date the taxpayer acquired land (whether or not a building was or is erected on that last-mentioned land) adjacent to the first-mentioned land,
the adjacent land shall be deemed for the purposes of this Part to be a separate asset from the first-mentioned land.
“(4) Where a building or other improvement of a capital nature made to land is treated for the purposes of this Act other than this Part as an asset separate from the land, the building or other improvement shall be deemed for the purposes of this Part to be a separate asset from the land.
“(5) Where an asset forming part of a building is treated for the purposes of this Act other than this Part as an asset separate from the building, the asset shall be deemed for the purposes of this Part to be a separate asset from the building.
“(6) Where —
(a) an asset acquired by a taxpayer before 20 September 1985 has been disposed of on or after that date;
(b) an improvement of a capital nature to the asset was made after the taxpayer acquired the asset;
(c) if the improvement were a separate asset from the asset to which it was made—
(i) the improvement would be taken for the purposes of this Part to have been acquired by the taxpayer on or after 20 September 1985; and
“(2) For the purposes of this section, where, by reason of the death of a person, a natural person acquires a percentage (in this sub-section referred to as the ‘acquired percentage’) of the underlying interests in an asset, the natural person shall be deemed to have held (in addition to any other part of the total underlying interests that the person held or is deemed to have held), at any time when the deceased person held a percentage (in this subsection referred to as the ‘deceased person’s percentage’) of the total underlying interests in the property, a percentage of the total underlying interests in the property equal to the acquired percentage, or the deceased person’s percentage at that time, whichever is the less.
“(3) In this section, ‘majority underlying interests’ and ‘underlying interest’, in relation to an asset, have the same meanings as those expressions have in relation to property in Subdivision G of Division 3 of Part III.
“160zzt. (1) Where—
(a) a taxpayer has, whether before or after the commencement of this Part, disposed of an asset being—
(i) shares in a private company;
(ii) an interest in a partnership; or
(iii) an interest in a private trust estate;
(b) the taxpayer acquired the asset before 20 September 1985;
(c) immediately before the disposal of the asset by the taxpayer—
(i) in a case where the asset disposed of by the taxpayer consisted of shares in a private company or an interest in a private trust estate, the property of the company or trust estate, as the case may be, included property (in this sub-section referred to as the ‘underlying property’) that—
(a) was acquired by the company or trustee of the trust estate, as the case may be, on or after 20 September 1985; and
(b) was not trading stock of the company or trust estate; or
(ii) the company, partnership or trustee of the trust estate, as the case may be, held an interest, through one or more interposed companies, partnerships or trusts, in property (in this sub-section also referred to as the ‘underlying property’) that—
(a) was acquired by another private company, partnership or trustee of a private trust estate on or after 20 September 1985; and
(b) was not trading stock of the company, partnership or trust estate referred to in sub-sub-paragraph (a); and
(d) immediately before the disposal of the asset by the taxpayer, the value of—
(i) in a case to which sub-paragraph (c) (i) applies—the underlying property referred to in that sub-paragraph; or
(ii) in a case to which sub-paragraph (c) (ii) applies—the interest referred to in that sub-paragraph,
was not less than 75% of the net worth of the company, partnership or trust estate referred to in paragraph (a),
a capital gain shall be deemed to have accrued to the taxpayer during the year of income in which the taxpayer disposed of the asset equal to so much of the consideration received or receivable by the taxpayer in respect of the disposal as may reasonably be attributed to the amount (if any) by which the value of the underlying property immediately before the disposal exceeds the sum of the amounts that would be the indexed cost bases to the taxpayer of the underlying property if the underlying property had been disposed of immediately before the disposal of the asset.
“(2) Expressions used in sub-section (1) of this section to which meanings are given by section 26aaa for the purposes of that section also have those meanings for the purposes of sub-section (1) of this section.
“(3) In calculating the net worth of a company, partnership or trust estate for the purposes of this section, the Commissioner shall, if satisfied that liabilities were discharged or released or assets acquired for the purpose, or for purposes that included the purpose, of ensuring that this section would not apply in relation to a taxpayer, disregard the discharge or release of those liabilities or the values of those assets, as the case may be.
“160zzu. (1) A person who has at any time after 19 September 1985 owned an asset other than an excepted asset shall keep such records in the English language as are necessary to enable the ready ascertainment of—
(a) the date on which the person acquired the asset;
(b) if the asset has not been disposed of—any amount that would, if the asset were disposed of, form part of the cost base to the person in respect of the asset; and
(c) if the asset has been disposed of by the person—
(i) the date of disposal;
(ii) any amount that formed part of the cost base to the person in respect of the asset; and
(iii) the consideration in respect of the disposal.
Penalty: $2,000.
“(2) For the purpose of the application of sub-section (1) in relation to a person, an asset is an excepted asset if—
(a) where the asset has been disposed of by the person—this Part did not apply in respect of the disposal; or
(b) where the asset has not been disposed of by the person—this Part would not, in the event of the disposal of the asset, apply in respect of the disposal.
“(3) This section does not require the keeping of any records by a person if—
(a) a period of 7 years has elapsed since the asset to which the records relate was disposed of by the person;
(b) the Commissioner has notified the person that the keeping of those records is not required; or
(c) the records are records of a company that has been wound up and has been dissolved.”.
(a) by inserting “, and profits or gains of a capital nature,” before “derived by him” in sub-section (1); and
(b) by inserting “or losses, being losses of a capital nature,” after “deductions” in sub-section (1).
“(3) In this section, a reference to income derived by a person includes a reference to profits or gains of a capital nature derived by the person.”.
(a) by inserting “or of profits or gains of a capital nature,” after “income,” in sub-section (1); and
(b) by inserting “, or of those profits or gains,” after “income” in sub-section (2).
(a) by inserting “, and of the profits or gains of a capital nature,” after “whole of the income” in sub-section (1); and
(b) by inserting “, or profits or gains of a capital nature,” after “income” in paragraph (1) (aa).
“(6) A reference in this Division to the amount of the taxable income of a company of a year shall, if by virtue of Part IIIa the assessable income of the company for that year included a net capital gain within the meaning of that Part, be construed as a reference to the amount that would have been that taxable income if that net capital gain had not been so included.”.
(a) by inserting after sub-section (1) the following sub-section:
“(1a) The reference in sub-section (1) to the income tax assessed in respect of the taxable income of a company of the year next preceding the year of income shall, if by virtue of Part IIIa the assessable income of the company of that next preceding year included a net capital gain within the meaning of that Part, be construed as a reference to the income tax that would have been payable in respect of the taxable income of the company of that year if that net capital gain had not been so included.”; and
(b) by inserting after sub-section (2a) the following sub-section:
“(2aa) Any estimate made for the purposes of this section of the amount of income tax that will be payable by a company in respect of its taxable income of the year of income shall be based on the assumption that the assessable income of the company of the year of income will not include any net capital gain within the meaning of Part IIIa.”.
“(1a) Any estimate made for the purposes of this section of the amount of income tax that will be payable by a company in respect of its taxable income of a year of income shall be based on the assumption that the assessable income of the company of that year of income will not include any net capital gain within the meaning of Part IIIa.”.
“(1b) For the purposes of this Division, the taxable income of a taxpayer for a year shall, if by virtue of Part IIIa the assessable income of the taxpayer for that year included a net capital gain within the meaning of that Part, be taken to be the amount that would have been that taxable income if that net capital gain had not been so included.”.
“(1aa) The reference in paragraph (1) (a) to the income tax assessed in respect of the taxable income of the year next preceding the year of income, or the reference in paragraph (1) (b) to the income tax which would have been payable in respect of the taxable income of the year next preceding the year of income, shall, if sub-section 221ya (1b) applies in relation to that taxable income, be construed as a reference to the income tax that would have been payable in respect of that taxable income if the net capital gain referred to in that sub-section had not been included in the assessable income of the taxpayer for that year.”.
“(1aa) Any estimate made for the purposes of this section of the taxable income of a taxpayer for a year of income shall be based on the assumption that the assessable income of the taxpayer of that year of income will not include any net capital gain within the meaning of Part IIIa.”.
(a) by inserting “, or any profits or gains of a capital nature,” after “income” in paragraph (1)(a);
(b) by inserting “, or those profits or gains,” after “income” in paragraph (1)(b); and
(c) by inserting “, profits or gains” after “income” in paragraphs (1) (d) and (e).
1. No. 27, 1936, as amended. For previous amendments, see No. 88, 1936; No. 5, 1937; No. 46, 1938; No. 30, 1939; Nos. 17 and 65, 1940; Nos. 58 and 69, 1941; Nos. 22 and 50, 1942; No. 10, 1943; Nos. 3 and 28, 1944; Nos. 4 and 37, 1945; No. 6, 1946; Nos. 11 and 63, 1947; No. 44, 1948; No. 66, 1949; No. 48, 1950; No. 44, 1951; Nos. 4, 28 and 90, 1952; Nos. 1, 28, 45 and 81, 1953; No. 43, 1954; Nos. 18 and 62, 1955; Nos. 25, 30 and 101, 1956; Nos. 39 and 65, 1957; No. 55, 1958; Nos. 12, 70 and 85, 1959; Nos. 17, 18, 58 and 108, 1960; Nos. 17, 27 and 94, 1961; Nos. 39 and 98, 1962; Nos. 34 and 69, 1963; Nos. 46, 68, 110 and 115, 1964; Nos. 33, 103 and 143, 1965; Nos. 50 and 83, 1966; Nos. 19, 38, 76 and 85, 1967; Nos. 4, 60, 70, 87 and 148, 1968; Nos. 18, 93 and 101, 1969; No. 87, 1970; Nos. 6, 54 and 93, 1971; Nos. 5, 46, 47, 65 and 85, 1972; Nos. 51, 52, 53, 164 and 165, 1973; No. 216, 1973 (as amended by No. 20, 1974); Nos. 26 and 126, 1974; Nos. 80 and 117, 1975; Nos. 50, 53, 56, 98, 143, 165 and 205, 1976; Nos. 57, 126 and 127, 1977; Nos. 36, 57, 87, 90, 123, 171 and 172, 1978; Nos. 12, 19, 27, 43, 62, 146, 147 and 149, 1979; Nos. 19, 24, 57, 58, 124, 133, 134 and 159, 1980; Nos. 61, 92, 108, 109, 110, 111, 154 and 175, 1981; Nos. 29, 38, 39, 76, 80, 106 and 123, 1982; Nos. 14, 25, 39, 49, 51, 54 and 103, 1983; Nos. 14, 42, 47, 63, 76, 115, 124, 165 and 174, 1984; No. 123, 1984 (as amended by No. 65, 1985); Nos. 47, 49, 104, 123, 168 and 173, 1985; and Nos. 41, 46, 48, 49 and 51, 1986.
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House of Representatives on 22 May 1986
Senate on 4 June 1986
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