Income Tax (Transitional Provisions) Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-45 - RULES FOR PARTICULAR INDUSTRIES AND OCCUPATIONS  

Division 328 - Small business entities  

SECTION 328-115   When you stop using the STS accounting method  

328-115(1)    
This section sets out what happens to your ordinary income and general deductions, and deductions under section 25-5 or 25-10 of the Income Tax Assessment Act 1997 , if:

(a) you are a small business entity for an income year and for the following income year (the changeover year ); and

(b) you were using the STS accounting method for the income year before the changeover year; and

(c) you change to an accruals accounting method for the changeover year.

328-115(2)    
This section also sets out what happens to your ordinary income and general deductions, and deductions under section 25-5 or 25-10 of the Income Tax Assessment Act 1997 , if:

(a) you are not a small business entity for an income year (also the changeover year ); and

(b) you were using the STS accounting method for the income year before the changeover year; and

(c) you change to an accruals accounting method for the changeover year.

328-115(3)    

Any ordinary income that, apart from paragraph 328-105(1) (a) of the Income Tax Assessment Act 1997 (as in force immediately before its repeal by Schedule 2 to the Tax Laws Amendment (2004 Measures No 7) Act 2005 ), you would have derived before the changeover year (while you were using the STS accounting method) and you have not included in your assessable income because you have not received it is included in your assessable income for the changeover year.

328-115(4)    

Any general deductions, and deductions under section 25-5 or 25-10 of the Income Tax Assessment Act 1997 , that, apart from paragraph 328-105(1) (b) of that Act (as in force immediately before its repeal by Schedule 2 to the Tax Laws Amendment (2004 Measures No 7) Act 2005 ), you would have incurred before the changeover year (while you were using the STS accounting method) and that you have not deducted because you have not paid them can be deducted for the changeover year.