Income Tax Assessment Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-3 - CAPITAL GAINS AND LOSSES: SPECIAL TOPICS  

Division 124 - Replacement-asset roll-overs  

Subdivision 124-F - Exchange of rights or options  

SECTION 124-300   Exchange of rights or option to acquire units in a unit trust  

124-300(1)    
You can choose to obtain a roll-over if:

(a) you own rights (the original rights ) to *acquire units in a unit trust or to acquire an option to acquire units in a unit trust; or

(b) you own an option (the original option ) to acquire units in a unit trust;

and these other requirements are satisfied.

Note:

Section 103-25 tells you when you have to make the choice.

124-300(2)    
The units must:

(a) be consolidated and divided into new units of a larger amount; or

(b) be subdivided into new units of a smaller amount.

124-300(3)    
The trustee must cancel the original rights or original option because of the consolidation or subdivision.

124-300(4)    
The trustee must:

(a) issue you with new rights (relating to the new units) in substitution for the original rights; or

(b) issue you with a new option (relating to the new units) in substitution for the original option.

124-300(5)    
You must receive nothing else in substitution for the original rights or original option.

124-300(6)    

The *market value of the new rights or new option just after it was issued must be at least equal to the market value of the original rights or original option just before it was cancelled.

124-300(7)    
One of these requirements must be satisfied:

(a) you must be an Australian resident at the time of the cancellation; or

(b) if you are a foreign resident at that time:

(i) the original rights or original option were *taxable Australian property just before that time; and

(ii) the new rights or new option are taxable Australian property when they are issued.

Note:

The roll-over consequences are set out in Subdivision 124-A . The original asset is the original rights or original option. The new asset is the new rights or new option.