INCOME TAX ASSESSMENT ACT 1936 (ARCHIVE)

PART III - LIABILITY TO TAXATION  

Division 3 - Deductions  

Subdivision A - General  

SECTION 75A   DEDUCTION OF CERTAIN EXPENDITURE ON LAND USED FOR PRIMARY PRODUCTION  

75A(1)   [Eligible expenditure]  

This section applies to expenditure incurred by a taxpayer who carries on a business of primary production on any land in Australia, being expenditure incurred in -

(a) (Omitted by No 159 of 1980)

(b) the destruction and removal of timber, scrub or undergrowth indigenous to the land;

(c) (Omitted by No 159 of 1980)

(d) the preparation of the land for agriculture;

(e) ploughing and grassing the land for grazing purposes;

(f) the draining of swamp or low-lying lands where that operation improves the agricultural or grazing value of the land; or

(g) preventing or combating flooding on the land otherwise than by way of an operation of the kind referred to in paragraph 75D(1)(e) or (f).

(h) (Omitted by No 58 of 1980)

75A(2)   [Exclusions]  

This section does not apply to expenditure incurred by a taxpayer where:

(a) a deduction has been allowed, or is allowable, in respect of the expenditure under any other provision of this Act from the assessable income of the taxpayer or of any other person of any year of income; or

(b) the taxpayer has been recouped, or is entitled to be recouped, in respect of the expenditure by the Commonwealth, by a State, by the Administration of a Territory, by an authority constituted by or under a law of the Commonwealth or of a State or Territory or by any other person and the amount recouped or to be recouped is not and will not be included in assessable income of the taxpayer of any year of income.

75A(2A)   [Commercial debt forgiveness]  

This section has effect subject to Division 245 of Schedule 2C .

75A(3)   [Allowable deduction]  

Where a taxpayer incurs expenditure to which this section applies, an amount equal to one-tenth of that expenditure is, subject to subsection (4), an allowable deduction in the assessment of the taxpayer in respect of income of the year of income in which the expenditure is incurred and in respect of each of the 9 succeeding years of income.

75A(4)   [Conditions for deductibility]  

A deduction in respect of expenditure incurred by a taxpayer in relation to land is not allowable under this section in the assessment of the taxpayer in respect of income of a year of income unless the taxpayer carried on a business of primary production on that land in that year of income or derived in that year of income assessable income from that land by reason of his having granted a lease of that land to a person who carried on a business of primary production on that land in that year of income.

75A(5)   [Where partnership incurs expenditure]  

This section does not apply in relation to the calculation of the net income of a partnership, or a partnership loss, in accordance with section 90 , but, where a partnership has incurred expenditure to which this section would apply if the partnership were a taxpayer, then, for the purposes of the application of subsection (3) in respect of a partner in the partnership, that partner shall be deemed to have incurred:

(a) so much of the amount of that expenditure as the partners have agreed is to be borne by that partner; or

(b) if the partners have not agreed as to the part of that amount that is to be borne by that partner - so much of that amount as bears to that amount the same proportion as the individual interest of the partner in the net income of the partnership of the year of income in which the relevant expenditure was incurred bears to that net income or, as the case requires, as the individual interest of the partner in the partnership loss for that year of income bears to that partnership loss.

75A(6)   [Expenditure after 23 August 1983]  

This section does not apply in relation to expenditure incurred by a taxpayer after 23 August 1983 unless the expenditure was incurred in pursuance of a contract entered into on or before that date.