Income Tax Assessment Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-10 - FINANCIAL TRANSACTIONS  

Division 240 - Arrangements treated as a sale and loan  

Subdivision 240-G - Adjustments if total amount assessed to notional seller differs from amount of interest  

Operative provisions

SECTION 240-105   Adjustments for notional seller  

240-105(1)    
This section applies at the end of the * arrangement.

240-105(2)    
If the sum of:

(a) all amounts (other than * termination amounts) that were paid or payable to the * notional seller under the * arrangement; and

(b) any termination amounts paid or payable to the notional seller;

exceeds the amount worked out using the formula in subsection (4), the excess is included in the notional seller ' s assessable income of the income year in which the arrangement ends.

Note:

Subsection 240-80(5) provides that the amount of a notional loan that is taken to be made by an extended or renewed arrangement is a termination amount paid under the previous arrangement.

240-105(3)    
If the amount worked out using the formula in subsection (4) exceeds:

(a) all amounts (other than * termination amounts) that were paid or payable to the * notional seller under the * arrangement; and

(b) any termination amounts paid or payable to the notional seller;

the notional seller is entitled to deduct the excess in the income year in which the arrangement ends.

Note:

Subsection 240-80(5) provides that the amount of a notional loan that is taken to be made by an extended or renewed arrangement is a termination amount paid under the previous arrangement.

240-105(4)    

The formula for the purposes of subsections (2) and (3) is:

Notional loan principal + Assessed notional interest

where:

assessed notional interest
means the * notional interest that has been or is to be included in the * notional seller ' s assessable income of any income year.