Income Tax Assessment Act 1997

CHAPTER 2 - LIABILITY RULES OF GENERAL APPLICATION  

PART 2-25 - TRADING STOCK  

Division 70 - Trading stock  

Subdivision 70-D - Assessable income arising from disposals of trading stock and certain other assets  

Operative provisions

SECTION 70-105   Death of owner  

70-105(1)    

When you die, your assessable income up to the time of your death includes the *market value at that time of the *trading stock of your *business (if any).

Note:

In the case of trees, you can deduct the relevant portion of your capital costs of acquiring the land carrying the trees or of acquiring a right to fell the trees: see section 70-120 .

70-105(2)    

The entity on which the *trading stock devolves is treated as having bought it for its *market value at that time.

70-105(3)    

However, your *legal personal representative can elect to have included in your assessable income (instead of the *market value) the amount that would have been the *value of the *trading stock at the end of an income year ending on the day of your death.

70-105(4)    

In the case of an asset covered by section 70-85 (which applies this Subdivision to certain other assets), your *legal personal representative can elect to have a nil amount included in your assessable income (instead of the *market value).

70-105(5)    
Your *legal personal representative can make an election only if:

(a) the *business is carried on after your death; and

(b) the *trading stock continues to be held as trading stock of that business, or the asset continues to be held as an asset of that business, as appropriate.

70-105(6)    

If an election is made, the entity on which the *trading stock devolves is treated as having bought it for the amount referred to in subsection (3) or (4).

70-105(7)    
An election can only be made on or before the day when your *legal personal representative lodges your *income tax return for the period up to your death. However, the Commissioner can allow it to be made later.