Income Tax (Transitional Provisions) Act 1997

Pt 2-25 inserted by No 121 of 1997.

Div 70 inserted by No 121 of 1997.

S 70-41 repealed by No 101 of 2006, s 3 and Sch 3 item 20, effective 1 January 2008. S 70-41 formerly read:

SECTION 70-41 Value of trading stock at the start of the 2001-2002 income year - oysters acquired by using the traditional stick farming method  
Application

70-41(1)
This section applies to you if:

(a) you carry on a business of oyster farming (other than oyster farming carried on in hatcheries); and

(b) you held oysters that are covered by subsection (2) as trading stock on hand at the start of the 2001-2002 income year (the relevant stock ); and

(c) some or all of those oysters should have been taken into account, as items of your trading stock on hand, and under Division 70 of the Income Tax Assessment Act 1997 , at the end of the 2000-2001 income year; and

(d) none of those oysters was so taken into account.

Oysters covered by subsection

70-41(2)
This subsection covers oysters all of which:

(a) were farmed by you solely for use as food for human consumption; and

(b) had not yet been harvested at the start of the 2001-2002 income year; and

(c) at or before that time, were acquired by you in this manner:

(i) you placed plastic slats or wooden sticks in the water for the purposes of capturing oyster spat; and

(ii) the oysters, as spat, attached themselves to those slats or sticks;

whether or not the oysters were, at the start of the 2001-2002 income year, still attached to those slats or sticks.

What happens if this section applies to you

70-41(3)
If this section applies to you, subsections (4) to (7) have effect for the purposes of Division 70 , and Subdivision 328-E , of the Income Tax Assessment Act 1997 .

General rule

70-41(4)
The value of the relevant stock, as the value of items of your trading stock on hand at the start of the 2001-2002 income year:

(a) is not to be worked out under section 70-40 of the Income Tax Assessment Act 1997 ; and

(b) is the amount worked out in accordance with subsection (6).

Special rule for an STS taxpayer

70-41(5)
If you were an STS taxpayer for the 2001-2002 income year, the value of all your trading stock on hand at the start of that income year:

(a) is not to be worked out under subsection 328-295(1) of the Income Tax Assessment Act 1997 ; and

(b) is the sum of:

(i) the value of the relevant stock (worked out in accordance with subsection (6)); and

(ii) the total value of items of your trading stock on hand at the end of the 2000-2001 income year that was taken into account under Division 70 of that Act at the end of the 2000-2001 income year.

Note 1:

This means that, if no value was taken into account as mentioned in subparagraph (b)(ii), the value of all your trading stock on hand at the start of the 2001-2002 income year is the value of the relevant stock.

Note 2:

The total value mentioned in subparagraph (b)(ii) would not include the value of any oysters that were items of the relevant stock (see paragraph (1)(d) and subsection (3)).

Value of the relevant stock

70-41(6)
The value of the relevant stock is the amount worked out in accordance with the following method statement: Method statement

Step 1.

Work out the total number of plastic slats that were used to acquire any items of the relevant stock (see subsection (7)), where each of the slats was approximately 1 metre long.

Step 2.

Add to the result of step 1 the number of times by which any of those slats were reused, after being used to acquire any items of the relevant stock for the first time, to acquire other items of the relevant stock.

Step 3.

Multiply the result of step 2 by 50 cents.

Step 4.

Work out the total number of wooden sticks, and plastic slats, that were used to acquire any items of the relevant stock, where each of the plastic slats was approximately 2 metres long.

Step 5.

Add to the result of step 4 the number of times by which any of the sticks or slats covered by step 4 were reused, after being used to acquire any items of the relevant stock for the first time, to acquire other items of the relevant stock.

Step 6.

Multiply the result of step 5 by $1.

Step 7.

Add the results of steps 3 and 6. The result of this step is the value of the relevant stock .

Slats and sticks used to acquire items of relevant stock

70-41(7)
For the purposes of subsection (6), a plastic slat or wooden stick is taken to have been used to acquire items of the relevant stock if it was used in the manner described in paragraph (2)(c) to capture oysters, as spat, that were items of the relevant stock.

Certain provisions are not affected

70-41(8)
This section does not affect the operation of any of the following provisions:

(a) section 102AAY of the Income Tax Assessment Act 1936 (modified application of trading stock provisions for certain non-resident trust estates);

(b) section 397 of that Act (modified application of trading stock provisions for eligible CFCs);

(c) section 57-115 of Schedule 2D to that Act (modified application of trading stock provisions for tax exempt entities that become taxable);

(d) section 165-115W of the Income Tax Assessment Act 1997 (trading stock decrease for a CGT asset).

S 70-41 inserted by No 119 of 2002.