Commonwealth Consolidated Acts Commonwealth Consolidated Acts(1) Subject to subsections (2) and (3), the following provisions apply to a partnership as if the partnership were a person:
(a) sections 614 to 623;
(b) subsections 262A(4) and (5), in so far as those subsections apply to records kept under or for the purposes of this Division;
(c) Part III of the Taxation Administration Act 1953 , in so far as that Part of that Act relates to the provisions covered by paragraph (a) or (b) of this subsection.
(2) If, because of subsection (1), an offence is taken to have been committed by a partnership, that offence is taken to have been committed by each of the partners.
(3) In a prosecution of a person for an offence because of subsection (2), it is a defence if the person proves that the person:
(a) did not aid, abet, counsel or procure the act or omission because of which the offence was taken to have been committed; and
(b) was not in any way, by act or omission, directly or indirectly, knowingly concerned in, or party to, an act or omission because of which the offence is taken to have been committed.
Contents
Schedule 2 1
Part I 1
Part II 2
Schedule 2C--Forgiveness of commercial debts 5
Division 245--Forgiveness of commercial debts 5
Guide to Division 245 5
245‑1..... What this Division is about ................................................................ 5
245‑2..... Simplified outline of this Division ...................................................... 5
245‑3..... Map of this Division .......................................................................... 7
Subdivision 245‑A--Debts to which this Division applies 8
Guide to Subdivision 245‑A 8
245‑5..... What this Subdivision is about ........................................................... 8
245‑6..... Map of this Subdivision ..................................................................... 8
Operative provisions 9
245‑10... Application of this Division ............................................................... 9
245‑15... What is a debt ..................................................................................... 9
245‑20... Debt includes accrued interest ............................................................ 9
245‑25... What constitutes a commercial debt ................................................. 10
245‑26... Application to trustees ..................................................................... 11
Subdivision 245‑B--What constitutes forgiveness of a debt 11
Guide to Subdivision 245‑B 11
245‑30... What this Subdivision is about ......................................................... 11
245‑31... Map of this Subdivision ................................................................... 12
Operative provisions 12
245‑35... What constitutes forgiveness of a debt ............................................ 12
245‑40... Forgivenesses to which this Division does not apply ...................... 14
Subdivision 245‑C--Calculation of gross forgiven amount of a debt 15
Guide to Subdivision 245‑C 15
245‑45... What this Subdivision is about ......................................................... 15
245‑46... Simplified outline of this Subdivision ............................................... 15
245‑47... Map of this Subdivision ................................................................... 16
Operative provisions 16
245‑50... What constitutes a forgiven debt if consideration is given in respect of the forgiveness 16
245‑55... Working out notional value of a debt other than a non‑recourse debt 17
245‑60... Special rule for working out notional value of a non‑recourse debt .. 18
245‑61... Special rule for working out notional value of parked debt .............. 19
245‑65... The consideration in respect of forgiveness of a debt ...................... 19
245‑70... Money or other property applied for benefit of creditor ................ 21
245‑75... Gross forgiven amount of a debt ...................................................... 22
Subdivision 245‑D--Calculation of net forgiven amount of a debt 23
Guide to Subdivision 245‑D 23
245‑80... What this Subdivision is about ......................................................... 23
245‑81... Map of this Subdivision ................................................................... 24
Operative provisions 25
245‑85... Reduction of gross forgiven amount ................................................. 25
245‑90... Agreement between companies under common ownership for creditor to forgo capital loss or revenue deduction .......................................................................................................... 25
Subdivision 245‑E--Application of net forgiven amounts 27
Guide to Subdivision 245‑E 27
245‑95... What this Subdivision is about ......................................................... 27
245‑96... Map of this Subdivision ................................................................... 28
General operative provisions 29
245‑100. Subdivision not to apply to calculation of attributable income ........ 29
245‑105. How total net forgiven amount is to be applied ............................... 29
Operative provisions relating to reduction of revenue losses 30
245‑110. Definitions applicable to provisions reducing revenue losses .......... 30
245‑115. Total net forgiven amount to be applied in reduction of revenue losses 31
245‑120. Allocation of total net forgiven amount in respect of deductible revenue losses 31
Operative provisions relating to reduction of net capital losses 31
245‑125. Definitions applicable to provisions reducing net capital
losses
................................................................................................
31
245‑130. Residual forgiven amount to be applied in reduction of net capital losses 32
245‑135. Allocation of residual forgiven amount in respect of deductible net capital losses 32
Operative provisions relating to reduction of deductible expenditure 32
245‑140. Definitions applicable to provisions reducing deductible expenditure 32
245‑145. Residual forgiven amount to be applied in reduction of deductible expenditures 34
245‑150. Allocation of residual forgiven amount in respect of deductible expenditures 34
245‑155. How a reduction of a deductible expenditure is to be effected ......... 34
245‑160. Amount applied in reduction of deductible expenditure to be included in assessable income in certain circumstances .......................................................................................................... 36
Operative provisions relating to reduction of cost bases of assets 36
245‑165. Definitions applicable to provisions reducing cost bases ................. 36
245‑170. Excluded assets ................................................................................. 36
245‑175. Residual forgiven amount to be applied in reduction of cost bases of assets 37
245‑180. Allocation of residual forgiven amount among relevant cost bases of assets 37
245‑185. Relevant cost bases of investments in associated entities to be reduced last 38
245‑190. How a reduction of the relevant cost bases of an asset is to be effected 38
Operative provision relating to unapplied total net forgiven amount 39
245‑195. No further consequences if there is any remaining unapplied total net forgiven amount 39
Subdivision 245‑F--Special rules relating to partnerships 39
Guide to Subdivision 245‑F 39
245‑200. What this Subdivision is about ......................................................... 39
245‑201. Map of this Subdivision ................................................................... 40
Operative provisions 40
245‑205. This Subdivision does not apply to corporate limited partnerships 40
245‑210. Subdivisions 245‑A to 245‑E to apply to partnerships ................... 41
245‑215. Unapplied total net forgiven amount of a partnership to be transferred to partners 41
Subdivision 245‑G--Special rules affecting related companies 42
Guide to Subdivision 245‑G 42
245‑220. What this Subdivision is about ......................................................... 42
245‑221. Map of this Subdivision ................................................................... 43
Operative provisions 44
245‑225. Application of Subdivision ............................................................... 44
245‑230. If any non‑debtor companies in a group of related companies have deductible revenue losses 45
245‑235. If any non‑debtor companies in a group of related companies have deductible net capital losses 46
245‑240. If neither section 245‑230 nor 245‑235 applies ............................... 47
Subdivision 245‑H--General 47
245‑245. Definitions ........................................................................................ 47
245‑250. Companies under common ownership ............................................. 48
245‑255. Controller of company ..................................................................... 48
245‑260. Time of incurring debt ...................................................................... 49
245‑265. Keeping and retention of records ...................................................... 49
Schedule 2D--Tax exempt entities that become taxable
[ see Note 2]
52
Division 57--Tax exempt entities that become taxable 52
Guide to Division 57 53
57‑1....... What this Division is about .............................................................. 53
Subdivision 57‑A--Key concepts 53
57‑5....... Entities to which this Division applies ............................................ 53
Subdivision 57‑B--Predecessors of the transition taxpayer 53
57‑10..... Activities of transition taxpayer's predecessor attributed to transition taxpayer 53
Subdivision 57‑C--Time when income derived 54
57‑15..... Time when income derived ............................................................... 54
Subdivision 57‑D--Time when losses and outgoings incurred 55
57‑20..... Time when losses and outgoings incurred ........................................ 55
Subdivision 57‑E--Assets and liabilities 55
57‑25..... Deemed disposal and re‑acquisition of assets .................................. 55
57‑30..... Deemed cessation and re‑assumption of liabilities ........................... 59
57‑35..... Interpretation .................................................................................... 60
Subdivision 57‑F--Superannuation deductions 61
57‑40..... Contributions under defined benefit superannuation schemes ......... 61
57‑45..... Deduction for surplus to meet defined benefit superannuation scheme liabilities 62
57‑50..... Contributions generally .................................................................... 63
57‑52..... Section 57‑50 does not apply if there is a surplus at transition time 66
57‑55..... Deductions reduced under both sections 57‑40 and 57‑50 ............... 66
Subdivision 57‑G--Denial of certain deductions 67
57‑60..... Effect of pre‑transition time accrued leave entitlements .................. 67
57‑65..... Treatment of bad debts ..................................................................... 69
57‑70..... Treatment of superannuation lump sums and employment termination payments 70
Subdivision 57‑H--Domestic losses 71
57‑75..... Domestic losses ................................................................................ 71
Subdivision 57‑J--Capital allowances and certain other
deductions
71
57‑85..... What are the modified deduction rules and corresponding deduction provisions ? 71
57‑90..... Post‑transition deductions--assume that the transition taxpayer had never been exempt 72
57‑95..... Amount of deduction not allowable for transition year ................... 73
57‑100... No elections etc. before transition time ............................................ 73
57‑105... Special rules for mining and quarrying .............................................. 74
Subdivision 57‑K--Balancing adjustments 74
57‑110... Apportionment of balancing adjustments ........................................ 74
Subdivision 57‑L--Trading stock 76
57‑115... Modification of trading stock provisions ......................................... 76
Subdivision 57‑M--Imputation 76
57‑120... Cancellation of franking surplus, credit or debit ............................... 76
57‑125... Subsidiary ......................................................................................... 78
Subdivision 57‑N--Division not applicable in respect of certain plant 78
57‑130... Plant or depreciating assets covered by Subdivision 58‑B of the Income Tax Assessment Act 1997 78
Schedule 2E--Leases of luxury cars [ see Note 2] 79
Division 42A--Leases of luxury cars 79
Guide to Division 42A 79
42A‑1.... What this Division is about .............................................................. 79
Subdivision 42A‑A--Notional sale of car, and notional loan, to lessee 80
Guide to Subdivision 42A‑A 80
42A‑5.... What this Subdivision is about ......................................................... 80
Operative provisions 80
42A‑10.. Application of this Division ............................................................. 80
42A‑15.. Notional sale of car by lessor and notional acquisition of car by lessee 81
42A‑20.. Consideration for notional sale, cost of notional acquisition, and depreciated value, of car 81
42A‑25.. Notional loan by lessor to lessee ...................................................... 82
Subdivision 42A‑B--Amounts to be included in lessor's assessable income 83
Guide to Subdivision 42A‑B 83
42A‑30.. What this Subdivision is about ......................................................... 83
Operative provisions 83
42A‑35.. Amounts to be included in lessor's assessable income ..................... 83
42A‑40.. Treatment of lease payments ........................................................... 84
Subdivision 42A‑C--Deductions allowable to lessee 85
Guide to Subdivision 42A‑C 85
42A‑45.. What this Subdivision is about ......................................................... 85
Operative provisions 85
42A‑50.. Extent to which deductions are allowable to lessee .......................... 85
42A‑55.. Lease payments not to be allowable deductions .............................. 86
Subdivision 42A‑D--Adjustments if total amount assessed to lessor differs from amount of finance charge 86
Guide to Subdivision 42A‑D 86
42A‑60.. What this Subdivision is about ......................................................... 86
Operative provisions 86
42A‑65.. Adjustments for lessor ..................................................................... 86
42A‑70.. Adjustments for lessee ..................................................................... 87
Subdivision 42A‑E--What happens when the lease expires 88
Guide to Subdivision 42A‑E 88
42A‑75.. What this Subdivision is about ......................................................... 88
Operative provisions 89
42A‑80.. What happens if the lease term is extended or the lease is renewed . 89
42A‑85.. What happens if an amount is paid by or on behalf of the lessee to acquire the car 90
42A‑90.. What happens if the lessee ceases to have the right to use the car ... 91
Subdivision 42A‑F--What happens if the lease is terminated before the end of the lease term 92
Guide to Subdivision 42A‑F 92
42A‑95.. What this Subdivision is about ......................................................... 92
Operative provisions 93
42A‑100 What happens if an amount is paid by or on behalf of the lessee to acquire the car 93
42A‑105 What happens if the lessee ceases to have the right to use the car ... 93
Subdivision 42A‑G--Interpretation 95
Guide to Subdivision 42A‑G 95
42A‑110 What this Subdivision is about ......................................................... 95
Operative provisions 95
42A‑115 General definitions ............................................................................ 95
42A‑120 Luxury car ......................................................................................... 98
42A‑125 Consecutive short‑term hiring agreements ........................................ 98
42A‑130 Finance charge ................................................................................... 99
42A‑135 Lease payment periods ..................................................................... 99
42A‑140 Accrual periods and accrual amounts ............................................. 100
42A‑145 Outstanding notional loan principal ............................................... 100
42A‑150 Implicit interest rate ....................................................................... 101
Schedule 2F--Trust losses and other deductions 102
Division 265--Overview of Schedule 102
265‑5..... What this Schedule is about ............................................................ 102
265‑10... Diagram giving overview of Schedule ............................................. 103
Division 266--Income tax consequences for fixed trusts of abnormal trading or change in ownership 104
Subdivision 266‑A--Overview of this Division 104
266‑5..... What this Division is about ............................................................ 104
266‑10... Diagram giving overview of this Division ....................................... 105
Subdivision 266‑B--Effect of change in ownership of fixed trust 106
266‑15... What this Subdivision is about ....................................................... 106
266‑20... Diagram giving overview of this Subdivision .................................. 107
266‑25... Fixed trust may be denied tax loss deduction ................................. 107
266‑30... Fixed trust may be required to work out its net income and tax loss in a special way 108
266‑35... Fixed trust may be denied debt deduction ...................................... 108
266‑40... The trust must pass 50% stake test ............................................... 109
266‑45... The trust must meet non‑fixed trust stake test .............................. 109
266‑50... Deducting part of a tax loss ............................................................ 111
266‑55... Information about non‑fixed trusts with interests in fixed trust .... 111
266‑60... Notices where requirements of section 266‑55 are met .................. 112
Subdivision 266‑C--Effect of change in ownership of unlisted widely held trust 113
266‑65... What this Subdivision is about ....................................................... 113
266‑70... Diagram giving overview of this Subdivision .................................. 114
266‑75... Unlisted widely held trust may be denied tax loss deduction ........ 114
266‑80... Unlisted widely held trust may be required to work out its net income and tax loss in a special way 115
266‑85... Unlisted widely held trust may be denied debt deduction ............. 116
266‑90... If abnormal trading or end of income year, trust must pass the 50% stake test 117
266‑95... Deducting part of a tax loss ............................................................ 118
Subdivision 266‑D--Effect of abnormal trading on listed widely held trust 118
266‑100. What this Subdivision is about ....................................................... 118
266‑105. Diagram giving overview of this Subdivision .................................. 119
266‑110. Listed widely held trust may be denied tax loss deduction ............ 120
266‑115. Listed widely held trust may be required to work out its net income and tax loss in a special way 120
266‑120. Listed widely held trust may be denied debt deduction ................. 121
266‑125. There must be no abnormal trading (subject to 50% stake or same business exceptions) 121
266‑130. Deducting part of a tax loss ............................................................ 122
266‑135. Listed widely held unit trust may be denied tax loss deduction otherwise allowable 122
Subdivision 266‑E--Effect of abnormal trading on unlisted very widely held trust or wholesale widely held trust 123
266‑140. What this Subdivision is about ....................................................... 123
266‑145. Diagram giving overview of this Subdivision .................................. 124
266‑150. Unlisted very widely held trust or wholesale widely held trust may be denied tax loss deduction 125
266‑155. Unlisted very widely held trust or wholesale widely held trust may be required to work out its net income and tax loss in a special way .............................................................................. 126
266‑160. Unlisted very widely held trust or wholesale widely held trust may be denied debt deduction 126
266‑165. There must be no abnormal trading (subject to 50% stake exception) 127
266‑170. Deducting part of a tax loss ............................................................ 128
Subdivision 266‑F--Information about family trusts with interests in other trusts 128
266‑175. What this Subdivision is about ....................................................... 128
266‑180. Information about family trusts with interests in other trusts ....... 128
266‑185. Notices where requirements of section 266‑180 are met ................ 129
Division 267--Income tax consequences for non‑fixed trusts of change in ownership or control 131
Subdivision 267‑A--Overview of this Division 131
267‑5..... What this Division is about ............................................................ 131
267‑10... Diagram giving overview of this Division ....................................... 131
Subdivision 267‑B--Deducting tax losses, and certain amounts in respect of debts, from earlier years 132
267‑15... What this Subdivision is about ....................................................... 132
267‑20... Non‑fixed trust may be denied tax loss deduction .......................... 132
267‑25... Non‑fixed trust may be denied debt deduction ............................... 133
267‑30... If certain distributions are made, the trust must pass the pattern of distributions test 134
267‑35... The trust must not have previously failed to meet the condition in subsection 267‑30(2) 134
267‑40... If there are individuals with more than a 50% stake in income or capital, more than a 50% stake in income or capital must be maintained ......................................................................... 135
267‑45... Group must not begin to control the trust ..................................... 135
267‑50... Deducting part of a tax loss ............................................................ 136
Subdivision 267‑C--Current year net income and tax loss, and certain debts incurred in current year 136
267‑55... What this Subdivision is about ....................................................... 136
267‑60... Trust may be required to work out its net income and tax loss in a special way 136
267‑65... Non‑fixed trust may be denied debt deduction ............................... 137
267‑70... If there are individuals with more than a 50% stake in income or capital, more than a 50% stake in income or capital must be maintained ......................................................................... 138
267‑75... Group must not begin to control trust ........................................... 138
Subdivision 267‑D--Information about family trusts with interests in other trusts 139
267‑80... What this Subdivision is about ....................................................... 139
267‑85... Information about family trusts with interests in other trusts ....... 139
267‑90... Notices where requirements of section 267‑85 are met .................. 140
Division 268--How to work out a trust's net income and tax loss for the income year 142
Subdivision 268‑A--Overview of Division 142
268‑5..... What this Division is about ............................................................ 142
Subdivision 268‑B--Dividing the income year into periods 142
268‑10... Income year of fixed trust to be divided into periods--first case .. 142
268‑15... Income year of fixed trust to be divided into periods--second case 143
268‑20... Income year of widely held unit trust to be divided into periods .. 144
268‑25... Income year of non‑fixed trust to be divided into periods ............. 144
Subdivision 268‑C--Other steps in working out the net income and tax loss 145
268‑30... Calculate the notional loss or net income for each period .............. 145
268‑35... How to attribute deductions to periods ......................................... 145
268‑40... How to attribute assessable income to periods .............................. 147
268‑45... How to calculate the trust's net income for the income year ......... 148
268‑60... How to work out the trust's section 36‑10 tax loss for the income year 149
Subdivision 268‑D--Rules that supplement Subdivision 268‑C if the trust is in partnership 150
268‑70... How to calculate the trust's notional loss or net income for a period when the trust was a partner 150
268‑75... How to calculate the trust's share of a partnership's notional loss or notional net income for a period if both entities have the same income year ............................................................. 150
268‑80... How to calculate the trust's share of a partnership's notional loss or notional net income for a period if the entities have different income years ............................................................ 151
268‑85... Trust's full year deductions include a share of partnership's full year deductions 152
Division 269--Concepts and tests applied in Divisions 266 and 267 153
Subdivision 269‑A--Overview of Division 153
269‑5..... What this Division is about ............................................................ 153
Subdivision 269‑B--Abnormal trading 153
269‑10... Trading ............................................................................................ 153
269‑15... Abnormal trading--general ............................................................. 153
269‑20... Abnormal trading--suspected acquisition or merger ...................... 154
269‑25... Abnormal trading--5% of units in a single transaction .................. 154
269‑30... Abnormal trading--suspected 5% of units in a series of transactions 154
269‑35... Abnormal trading--20% of units traded, issued or redeemed over 60 day period 154
269‑40... Abnormal trading--50% stake not maintained ............................... 155
269‑45... Time at which trustee to have knowledge or suspicion .................. 155
269‑47... Abnormal trading where holding trust ............................................ 155
269‑49... No abnormal trading where proportionate issue of units ............... 156
Subdivision 269‑C--Passing the 50% stake test etc. 156
269‑50... More than a 50% stake in income or capital .................................. 156
269‑55... Passing the 50% stake test ............................................................. 156
Subdivision 269‑D--Pattern of distributions test 157
269‑60... Pattern of distributions test ............................................................ 157
269‑65... Test year distribution of income or capital .................................... 157
269‑70... When individual receives different percentages .............................. 158
269‑75... Incomplete distributions ................................................................. 158
269‑80... Where individual's death or breakdown of marriage or relationship 159
269‑85... Arrangements to pass pattern of distributions test ........................ 160
Subdivision 269‑E--Control a non‑fixed trust 160
269‑95... Control a non‑fixed trust ................................................................ 160
Subdivision 269‑F--Same business test 163
269‑100. Passing the same business test ....................................................... 163
Division 270--Schemes to take advantage of deductions 165
270‑5..... What this Division is about ............................................................ 165
270‑10... Schemes to take advantage of deductions ....................................... 165
270‑15... Tax consequences of schemes ......................................................... 166
270‑20... Benefit ............................................................................................ 167
270‑25... Outsider to trust ............................................................................. 167
Division 271--Family trust distribution tax 169
271‑5..... What this Division is about ............................................................ 169
271‑10... Family trust distribution tax ........................................................... 169
271‑15... Tax liability where family trust makes distribution etc. outside family group 169
271‑20... Tax liability where interposed trust makes distribution etc. outside family group 170
271‑25... Tax liability where interposed partnership makes distribution etc. outside family group 171
271‑30... Tax liability where interposed company makes distribution outside family group 172
271‑35... Avoidance of double‑counting ........................................................ 172
271‑40... Exclusion of directors from liability to pay tax .............................. 173
271‑45... Requirements for section 271‑55 notice to family trust ................. 173
271‑50... Requirements for section 271‑55 notice to interposed entity ........ 174
271‑55... Notice requiring information about non‑resident distributions etc. 176
271‑60... Tax liability where non‑resident family trust's tax unpaid ............ 178
271‑65... Tax liability where non‑resident interposed entity's tax unpaid .... 180
271‑70... Reduction of liability where tax paid .............................................. 183
271‑75... Payment of family trust distribution tax ........................................ 183
271‑80... Late payment of family trust distribution tax ................................ 184
271‑90... Notice of liability ............................................................................ 184
271‑95... Request for notice of liability ......................................................... 185
271‑100. Evidentiary effect of notice of liability ........................................... 186
271‑105. Amounts subject to family trust distribution tax not assessable ... 187
Division 272--Interpretation 188
Subdivision 272‑A--Fixed entitlement to share of income or capital 188
272‑5..... Fixed entitlement to share of income or capital of a trust .............. 188
272‑10... Fixed entitlement to share of income or capital of a company ....... 189
272‑15... Fixed entitlement to share of income or capital of a partnership ... 189
272‑20... Fixed entitlement to share of income or capital held indirectly ...... 190
272‑25... Special cases of fixed entitlements held directly or indirectly ........ 190
272‑30... Additional special cases of fixed entitlements held directly or indirectly 193
272‑35... Arrangements to pass fixed entitlement tests ................................. 194
272‑40... Continued holding of fixed entitlement where death occurs ........... 195
Subdivision 272‑B--Distribution of income or capital 195
272‑45... Trust distribution to beneficiary .................................................... 195
272‑50... Company distribution to shareholder ............................................. 195
272‑55... Partnership distribution to partner ................................................. 196
272‑60... Other distributions of income and capital ...................................... 196
272‑63... Distribute indirectly ....................................................................... 197
Subdivision 272‑C--Fixed trusts and non‑fixed trusts 197
272‑65... Fixed trust ....................................................................................... 197
272‑70... Non‑fixed trust ............................................................................... 198
Subdivision 272‑D--Family trust etc. 198
272‑75... Family trust .................................................................................... 198
272‑80... Family trust election ....................................................................... 198
272‑85... Interposed entity election ............................................................... 203
272‑87... Passing the family control test ....................................................... 206
272‑90... Family group .................................................................................. 208
272‑95... Family ............................................................................................. 212
Subdivision 272‑E--Excepted trust 212
272‑100. Excepted trust ................................................................................. 212
Subdivision 272‑F--Widely held unit trust 213
272‑105. Widely held unit trust ..................................................................... 213
Subdivision 272‑G--Unlisted widely held trust and listed widely held trust 214
272‑110. Unlisted widely held trust .............................................................. 214
272‑115. Listed widely held trust .................................................................. 214
Subdivision 272‑H--Unlisted very widely held trust 215
272‑120. Unlisted very widely held trust ...................................................... 215
Subdivision 272‑I--Wholesale widely held trust 216
272‑125. Wholesale widely held trust ........................................................... 216
Subdivision 272‑J--Kind of trust can be affected by ownership by higher level trust 217
272‑127. Kind of trust can be affected by ownership by higher level trust .. 217
Subdivision 272‑K--Trusts beginning or ceasing to exist 217
272‑130. Trusts beginning or ceasing to exist ................................................ 217
Subdivision 272‑L--Listed public company 218
272‑135. Listed public company ................................................................... 218
Subdivision 272‑M--Various definitions 219
272‑140. Definitions ...................................................................................... 219
Schedule 2G--Farm management deposits [ see Note 2] 223
Division 393--Farm management deposits 223
Guide to Division 393 223
393‑1..... What this Division is about ............................................................ 223
Subdivision 393‑A--Tax consequences of farm management deposits 224
Guide to Subdivision 224
393‑5..... What this Subdivision is about ....................................................... 224
393‑7..... Definitions of terms ........................................................................ 224
Operative provisions 224
393‑10... Deduction for making farm management deposit ........................... 224
393‑15... Assessability on repayment of deposit .......................................... 225
Subdivision 393‑B--Farm management deposit and related terms 228
Guide to Subdivision 393‑B 228
393‑20... What this Subdivision is about ....................................................... 228
Operative provisions 228
393‑25... Various definitions .......................................................................... 228
393‑30... Requirements for a farm management deposit ................................ 230
393‑35... Requirements whose contravention causes a loss of farm management deposit status 231
393‑37... Withdrawal of deposit within first 12 months ............................... 232
393‑40... Other requirements of agreement .................................................... 234
393‑45... Contraventions that deprive a deposit of its status as a farm management deposit 235
393‑50... Making and repaying etc. deposits ................................................. 235
393‑52... Certain entities taken to be financial institutions for pre‑1 July 2003 deposits and transfers 237
Subdivision 393‑C--How to work out your taxable primary production income and your taxable non‑primary production income 240
Guide to Subdivision 393‑C 240
393‑55... What this Subdivision is about ....................................................... 240
Operative provisions 240
393‑60... Working out your taxable primary production income .................. 240
393‑65... Working out your taxable non‑primary production income ........... 241
Subdivision 393‑D--Special rules relating to financial claims scheme for account‑holders with insolvent ADIs 243
Guide to Subdivision 393‑D 243
393‑75... What this Subdivision is about ....................................................... 243
Operative provisions 243
393‑80... Farm management deposits arising from farm management deposits with ADIs subject to financial claims scheme ........................................................................................................ 243
393‑85... Repayment if owner of farm management deposit with insolvent ADI dies, is bankrupt or ceases to be a primary producer .......................................................................................... 246
Schedule 2H--Demutualisation of mutual entities other than insurance companies and health insurers [ see Note 2] 248
Division 326--Demutualisation 248
Guide to Division 326 249
326‑1..... What this Division is about ............................................................ 249
Subdivision 326‑A--Application, key concepts and related expressions 249
326‑5..... Application ..................................................................................... 249
326‑10... Mutual entity and demutualisation ................................................ 251
326‑15... Provisions relating to listing on a stock exchange ........................... 251
326‑20... Demutualisation resolutions etc. .................................................... 252
326‑25... Demutualisation shares ................................................................... 252
326‑30... Existing members and new members .............................................. 253
326‑35... Pre‑CGT members and post‑CGT members .................................. 253
Subdivision 326‑B--How demutualisation is to be effected 254
326‑40... Methods of demutualisation ........................................................... 254
326‑45... Direct method ................................................................................. 254
326‑50... Holding company method .............................................................. 255
326‑52... Combined direct and holding company method ............................. 256
326‑55... Distributing trust method ............................................................... 257
326‑60... Continuity of beneficial interest test .............................................. 259
Subdivision 326‑C--CGT consequences of extinguishment of membership rights in mutual entity 261
326‑65... Extinguishment of membership rights ............................................ 261
Subdivision 326‑D--CGT consequences of disposal of demutualisation shares or an interest in such shares by a member of a mutual entity where the entity or a holding company of the entity becomes a listed public company 261
326‑70... Application of Subdivision ............................................................. 262
326‑75... Capital losses made from certain disposals to be disregarded ........ 262
326‑80... Disposal by pre‑CGT member of a demutualisation share (other than a demutualisation original share) or an interest in such a share before demutualisation listing day where member did not acquire membership rights by disposing of membership rights in another mutual entity ................................... 263
326‑85... Disposal by pre‑CGT member of a demutualisation share (other than a demutualisation original share) or an interest in such a share on or after demutualisation listing day where member did not acquire membership rights by disposing of membership rights in another mutual entity ................................... 264
326‑90... Disposal by pre‑CGT member of a demutualisation share (other than a demutualisation original share) or an interest in such a share where member acquired membership rights by disposing of membership rights in another mutual entity ........................................................................................................ 265
326‑95... Disposal by post‑CGT member of a demutualisation share (other than a demutualisation original share) or an interest in such a share ................................................................................. 266
326‑100. Disposal by pre‑CGT member of a demutualisation original share or a non‑demutualisation bonus share, or an interest in such a share, before demutualisation listing day where member did not acquire membership rights by disposing of membership rights in another mutual entity ................................... 267
326‑105. Disposal by pre‑CGT member of a demutualisation original share or a non‑demutualisation bonus share, or an interest in such a share, on or after demutualisation listing day where member did not acquire membership rights by disposing of membership rights in another mutual entity .............................. 268
326‑110. Disposal by pre‑CGT member of a demutualisation original share or a non‑demutualisation bonus share, or an interest in such a share, where member acquired membership rights by disposing of membership rights in another mutual entity ........................................................................................................ 269
326‑115. Disposal by post‑CGT member of a demutualisation original share or a non‑demutualisation bonus share or an interest in such a share ................................................................................. 270
326‑120. Adjusted market value .................................................................... 271
326‑125. Undeducted membership costs ....................................................... 272
326‑130. Adjusted first day trading price of demutualisation shares ............ 273
Subdivision 326‑E--CGT consequences of disposal of demutualisation shares or interests in such shares by a member of a mutual entity where the entity or a holding company of the entity becomes a company that is not a listed public company 274
326‑135. Application of Subdivision ............................................................. 275
326‑140. Disposal by pre‑CGT member of a demutualisation share (other than a demutualisation original share) or an interest in such a share where a member did not acquire membership rights by disposing of membership rights in another mutual entity .............................................................................................. 275
326‑145. Disposal by pre‑CGT member of a demutualisation share (other than a demutualisation original share) or an interest in such a share where member acquired membership rights by disposing of membership rights in another mutual entity ........................................................................................................ 276
326‑150. Disposal by post‑CGT member of a demutualisation share (other than a demutualisation original share) or an interest in such a share ................................................................................. 277
326‑155. Disposal by pre‑CGT member of a demutualisation original share or a non‑demutualisation bonus share, or an interest in such a share, where member did not acquire membership rights by disposing of membership rights in another mutual entity .............................................................................................. 278
326‑160. Disposal by pre‑CGT member of a demutualisation original share or a non‑demutualisation bonus share, or an interest in such a share, where member acquired membership rights by disposing of membership rights in another mutual entity ........................................................................................................ 279
326‑165. Disposal by post‑CGT member of a demutualisation original share or a non‑demutualisation bonus share, or an interest in such a share .................................................................... 280
326‑170. Various adjusted market values ...................................................... 281
326‑175. Undeducted membership costs ....................................................... 282
Subdivision 326‑F--Variation of amount taken to be paid for shares or an interest in shares by a member of a mutual entity who made a capital gain or capital loss from disposal of membership rights in another mutual entity 284
326‑180. Amount taken to be paid for acquisition of shares or interest by member to be increased by capital gain or reduced by capital loss ...................................................................................... 284
Subdivision 326‑G--CGT consequences of disposal of rights or interests resulting from extinguishment of membership rights 285
326‑185. Disposal of right to receive shares in demutualised entity ............. 285
326‑190. Extinguishment of right to shares in demutualised entity by the issue of the shares 286
326‑195. Disposal of right to receive shares in holding company ................. 286
326‑200. Disposal of interest in trust that holds shares in demutualised entity 287
Subdivision 326‑H--CGT consequences of transfer of ordinary shares 289
326‑205. Transfer of share or distribution of proceeds of sale of share not to have any CGT consequences 289
Subdivision 326‑I--CGT consequences of disposal of demutualisation shares or an interest in such shares by a trustee on behalf of a member 289
326‑210. Disposal by a trustee ...................................................................... 289
Subdivision 326‑J--CGT consequences of change in rights attaching to special shares or replacement of special shares by ordinary shares 290
326‑215. Change of rights to, and replacement of, special shares ................. 290
Subdivision 326‑K--CGT consequences of disposal of shares or an interest in shares acquired under a roll‑over provision 290
326‑220. Disposal of shares or interest in shares .......................................... 290
Subdivision 326‑L--CGT consequences of payment to member of demutualised entity out of accumulated surplus of the entity 291
326‑225. Payment out of assets of demutualised entity that is not included in assessable income is taken not to be a dividend ........................................................................................................ 292
Subdivision 326‑M--Indexation 292
326‑230. Indexing of amounts ........................................................................ 292
326‑235. Indexation factor ............................................................................. 292
326‑240. Index number .................................................................................. 293
Subdivision 326‑N--Non‑CGT consequences of issue of demutualisation shares 293
326‑245. General taxation consequences of issue of demutualisation shares 293
Schedule 2J--General insurance 294
Division 321--General insurance companies 294
Guide to Division 321 294
321‑1..... What this Division is about ............................................................ 294
Subdivision 321‑A--Provision for or payment of claims 294
Guide to Subdivision 321‑A 294
321‑5..... What this Subdivision is about ....................................................... 294
Operative provisions 295
321‑10... Amount to be included in assessable income for outstanding claims liability 295
321‑15... Deduction for outstanding claims liability ...................................... 295
321‑20... How value of outstanding claims liability is worked out ............... 295
321‑25... Deduction for claims paid during year of income ........................... 296
321‑30... Application: insurance business other than reinsurance business .. 296
321‑35... Application: reinsurance business .................................................. 296
Subdivision 321‑B--Premium income 297
Guide to Subdivision 321‑B 297
321‑40... What this Subdivision is about ....................................................... 297
Operative provisions 298
321‑45... Assessable income to include gross premiums ............................... 298
321‑50... Amount to be included in assessable income for reduction in value of unearned premium reserve 298
321‑55... Deduction for increase in value of unearned premium reserve ....... 298
321‑60... How value of unearned premium reserve is worked out ................ 298
321‑65... Application ..................................................................................... 300
Division 323--Companies that are not required by law to insure in respect of workers' compensation liabilities 301
Guide to Division 323 301
323‑1..... What this Division is about ............................................................ 301
Operative provisions 301
323‑5..... Amount to be included in assessable income for outstanding claims liability 301
323‑10... Deduction for outstanding claims liability ...................................... 302
323‑15... How value of outstanding claims liability is worked out ............... 302
323‑20... Deductions for claims paid during year of income ......................... 302
323‑25... Application ..................................................................................... 302
Schedule 3--Approved stock exchanges for the purposes of Part XI 303
Schedule 4--Business activities that are not eligible activities for the purposes of Division 3 of Part XI 308
Schedule 5--Approved international sectoral classification systems for purposes of Part XI 309