INCOME TAX ASSESSMENT ACT 1936 (ARCHIVE)

PART XII - DROUGHT INVESTMENT ALLOWANCE  

Division 6 - Special provisions about leasing companies  

Subdivision B - Group companies  

SECTION 667   DEDUCTION NOT LOST TO LEASING COMPANY DESPITE LESSEE CONTRACT ETC. FOR USE OF PROPERTY BEFORE START OF 12 MONTH PERIOD  

667(1)   When section applies.  

This section applies if:

(a) the taxpayer would lose the entitlement to a deduction under section 643 or 662 because the lessee entered into a contract or arrangement with another person for the use of the item of drought mitigation property by the person; and

(b) the other person is a group company (see section 682 ) of the lessee.

667(2)   Conditions for not losing the deduction.  

The taxpayer does not lose the entitlement to the deduction if:

(a) the use of the item under the contract or arrangement was:

(i) to take place while the group company remains a group company of the lessee; and

(ii) to be wholly and exclusively both in Australia and for the purpose of producing assessable primary production income other than by leasing the item or granting a right to another person to use the item; and

(b) at all times during the required period (see subsection (3)), the use of the item was in accordance with paragraph (a).

667(3)   The required period.  

The required period is so much of the term of the contract or arrangement as happens before the end of the period of 12 months after the lessee first used the item or installed it ready for use.