Income Tax Assessment Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

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

Division 122 - Roll-over for the disposal of assets to, or the creation of assets in, a wholly-owned company  

Subdivision 122-B - Disposal or creation of assets by partners to a wholly-owned company  

When is a roll-over available

SECTION 122-145   Rules for working out what a liability in respect of an interest in an asset is  

122-145(1)    
These rules are relevant to working out what are the liabilities in respect of a partner's interests in an asset.

122-145(2)    
A liability incurred for the purposes of a *business that is not a liability in respect of interests in a specific asset or assets of the business is taken to be a liability in respect of the partner's interests in all the assets of the business.

Note:

An example is a bank overdraft.

122-145(3)    

If a liability is in respect of both:

(a) the partner's interests in one or more assets that the partner *acquired on or after 20 September 1985; and

(b) the partner's interests in one or more assets that the partner acquired before that day;

the proportion of the liability that is in respect of the partner's interests that the partner acquired on or after that day is equal to:

The *market value of the partner's interest             that the partner *acquired on or after that day             The total of the market values of all the partner's interest in assets that the liability is in respect of