Commonwealth Numbered Acts

TAXATION LAWS AMENDMENT ACT 1990No. 35, 1990 - SECT 9

9. After section 73C of the Principal Act the following section is inserted:
Guaranteed returns to investors

"73CA. (1) For the purposes of interpretation, this section is to be read and
construed as if it were part of section 73B.

"(2) Where:

   (a)  an amount or amounts would, but for this section and section 73D, be
        allowable as a deduction or deductions under section 73B as affected
        by section 73C to an eligible company in respect of expenditure
        incurred in a year of income; and

   (b)  that amount or the sum of those amounts exceeds the amount of the
        expenditure; and

   (c)  the Commissioner is satisfied that, when the expenditure was incurred,
        the company was not at risk in respect of the whole or a part of the
        expenditure; the following provisions of this section have effect.

"(3) If the Commissioner is so satisfied in respect of the whole of the
expenditure, the amount, or the sum of the amounts, referred to in paragraph
(2) (a) is taken to be reduced by the amount of the excess referred to in
paragraph (2) (b).

"(4) If the Commissioner is so satisfied in respect of part of the
expenditure, the amount, or the sum of the amounts, referred to in paragraph
(2) (a) is taken to be reduced by an amount ascertained in accordance with the
formula:
Part of expenditure not at risk
Excess X -------------------------------
The amount of the expenditure where: Excess means the amount of the excess
referred to in paragraph (2) (b); Part of expenditure not at risk means the
part of the expenditure in respect of which the Commissioner is satisfied that
the company was not at risk when the expenditure was incurred.

"(5) For the purposes of the application of this section in relation to any
expenditure incurred by a company, the company is taken to have not been at
risk at the time when the expenditure was incurred in respect of so much of
the expenditure as does not exceed any consideration that, in the opinion of
the Commissioner, because of:

   (a)  any act that occurred, transaction or agreement that was entered into,
        or circumstance that existed, before or at that time; or

   (b)  any act that was likely to occur, any transaction or agreement that
        was likely to be entered into, or any circumstance that was likely to
        exist, after that time; the company or any associate of the company
        could reasonably have expected at that time to receive as the direct
        or indirect result of the incurring of the expenditure.

"(6) In this section:
'agreement' means any agreement, arrangement, understanding or scheme, whether
formal or informal, whether express or implied, and whether or not intended to
be enforceable by legal proceedings.".