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Income Tax Assessment Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES

PART 3-5 - CORPORATE TAXPAYERS AND CORPORATE DISTRIBUTIONS

Division 165 - Income tax consequences of changing ownership or control of a company

Subdivision 165-CB - Working out the net capital gain and the net capital loss for the income year of the change

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Working out the company's net capital gain and net capital loss

SECTION 165-111

165-111 How to work out the company ' s net capital gain
The company ' s net capital gain for the income year is worked out in this way: Working out the company ' s net capital gain

Step 1.

Add up the *notional net capital gains (if any) worked out under section 165-108 .

Note:

A notional net capital loss for a period is not taken into account, but counts towards the company ' s net capital loss for the income year.

Step 2.

Add to the Step 1 amount so much of each amount included in the company ' s assessable income for the income year under:

(a) section 97 (Beneficiary of a trust estate who is not under a legal disability) of the Income Tax Assessment Act 1936 ; or

(b) section 98A (Non-resident beneficiaries assessable in respect of certain income) of that Act;

as is attributable to a *capital gain that the trust made outside the income year.

Note:

This is relevant only if the trust has an income year that starts and ends at a different time from when the company ' s income year starts and ends.

Step 3.

If the Step 2 amount is more than zero, reduce it by applying any unapplied *net capital losses from previous income years. (If this reduces it to zero, the company has no net capital gain for the income year.)