Income Tax (Transitional Provisions) Act 1997

Chapter 4 inserted by No 162 of 2001.

Part 4-5 inserted by No 162 of 2001.

Div 770 repealed by No 143 of 2007 , s 3 and Sch 1 item 227, effective 30 June 2014.

Div 770 inserted by No 143 of 2007 , s 3 and Sch 1 item 5, applicable in relation to income years, statutory accounting periods and notional accounting periods starting on or after the first 1 July that occurs after 24 September 2007. No 143 of 2007 , s 3 and Sch 1 Part 6 contains the following savings provisions:

Part 6 - Savings provisions

Object  
225
The object of this Part is to ensure that, despite the repeals and amendments made by this Act, the full legal and administrative consequences of:

(a) any act done or omitted to be done; or

(b) any state of affairs existing; or

(c) any period ending;

before such a repeal or amendment applies, can continue to arise and be carried out, directly or indirectly through an indefinite number of steps, even if some or all of those steps are taken after the repeal or amendment applies.

Making and amending assessments, and doing other things, in relation to past matters  
226
Even though an Act is repealed or amended by this Act, the repeal or amendment is disregarded for the purpose of doing any of the following under any Act or legislative instrument (within the meaning of the Legislative Instruments Act 2003 ):

(a) making or amending an assessment (including under a provision that is itself repealed or amended);

(b) exercising any right or power, performing any obligation or duty or doing any other thing (including under a provision that is itself repealed or amended);

in relation to any act done or omitted to be done, any state of affairs existing, or any period ending, before the repeal or amendment applies.

Example:

For the 2006-07 income year, Smart Investor Pty Ltd, an Australian resident private investment company, has assessable foreign income in the passive income class on which it has paid foreign tax for which it wishes to claim a foreign tax credit. The company also has a tax loss for the year from its Australian investments. When it lodges its tax return for the year it does not elect to claim a deduction for any of the tax loss under section 79DA of the ITAA 1936, because the Australian tax payable on its passive foreign income equals the foreign tax it has paid.

In 2009 the amount of foreign tax payable in respect of some foreign rental income it had included in its return for the 2006-07 year is reduced and Smart Investor receives a refund of the difference in foreign tax. Smart Investor Pty Ltd then applies to be able to make an election under section 79DA , that is, after the Tax Laws Amendment (2007 Measures No. 4) Act 2007 (which repeals section 79DA ) receives Royal Assent. The Commissioner allows Smart Investor to submit an election to claim a deduction for so much of its 2006-07 tax loss as to reduce the amount of Australian tax payable on its 2006-07 assessable foreign income to the revised foreign tax paid, by the end of 2009.

Despite the repeal of section 79DA , item 226 allows the Commissioner to permit an election to be lodged after the return for 2006-07 has been lodged, and to amend Smart Investor's assessment for that year, because these actions relate to a thing done, and period ending, before the repeal of section 79DA applies.

Subdiv 770-A repealed by No 143 of 2007 , s 3 and Sch 1 item 227, effective 30 June 2014.

Subdiv 770-A inserted by No 143 of 2007 , s 3 and Sch 1 item 5, applicable in relation to income years, statutory accounting periods and notional accounting periods starting on or after the first 1 July that occurs after 24 September 2007. For savings provisions, see note under Div 770 heading.

S 770-30 repealed by No 143 of 2007 , s 3 and Sch 1 item 227, effective 30 June 2014. S 770-30 formerly read:

SECTION 770-30 Deduction limit for foreign loss component  
770-30(1)
The amount of the foreign loss component of one or more tax losses in a loss parcel that an entity can deduct in an income year cannot exceed the amount worked out for the year using the table.

Limit on deducting foreign loss component of a tax loss
Item	For this income year:	The amount of the component that you can deduct cannot exceed:
1	The commencement year	1/5 of the starting total for the loss parcel
2	The first income year ending after the commencement year	The difference between: (a) 2/5 of the starting total for the loss parcel; and (b) the amount of the foreign loss component of one or more tax losses in the loss parcel deducted for the income year mentioned in item 1
3	The second income year ending after the commencement year	The difference between: (a) 3/5 of the starting total for the loss parcel; and (b) the amount of the foreign loss component of one or more tax losses in the loss parcel deducted for the income years mentioned in items 1 and 2
4	The third income year ending after the commencement year	The difference between: (a) 4/5 of the starting total for the loss parcel; and (b) the amount of the foreign loss component of one or more tax losses in the loss parcel deducted for the income years mentioned in items 1, 2 and 3

Note:

There may be a reduction of the limit for the head company of a consolidated group under section 770-100 .

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History

S 770-30(1) amended by No 88 of 2009, s 3 and Sch 5 item 268, by substituting " an " for " any " after " loss parcel that " , applicable in relation to income years, statutory accounting periods and notional accounting periods starting on or after 1 July 2008.

770-30(2)
This section does not limit the amount of the foreign loss component of a tax loss that an entity can deduct in a year later than the third income year ending after the commencement year.

Note:

For later years, any remaining tax loss may be utilised to the extent permitted by the general rules for tax losses.

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History

S 770-30(2) amended by No 88 of 2013, s 3 and Sch 6 item 43, by substituting " tax loss may be utilised " for " undeducted tax loss may be deducted " in the note, effective 29 June 2013.

770-30(3)
To avoid doubt, if, because of subsection (1) or section 770-100 , an entity cannot deduct all or part of a tax loss in an income year, subsection 36-17(7) of the 1997 Act does not prevent the entity deducting other tax losses in the same year in accordance with that subsection.

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History

S 770-30(3) inserted by No 88 of 2009, s 3 and Sch 5 item 269, applicable in relation to income years, statutory accounting periods and notional accounting periods starting on or after 1 July 2008.

S 770-30 inserted by No 143 of 2007 , s 3 and Sch 1 item 5, applicable in relation to income years, statutory accounting periods and notional accounting periods starting on or after the first 1 July that occurs after 24 September 2007. For savings provisions, see note under Div 770 heading.