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Div 770 repealed by No 143 of 2007 , s 3 and Sch 1 item 227, effective 30 June 2014.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Even though an Act is repealed or amended by this Act, the repeal or amendment is disregarded for the purpose of doing any of the following under any Act or legislative instrument (within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(a) making or amending an assessment (including under a provision that is itself repealed or amended);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right or power, performing any obligation or duty or doing any other thing (including under a provision that is itself repealed or amended);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-B repealed by No 143 of 2007 , s 3 and Sch 1 item 227, effective 30 June 2014.

Subdiv 770-B 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 770-95 repealed by No 143 of 2007 , s 3 and Sch 1 item 227, effective 30 June 2014. S 770-95 formerly read:

SECTION 770-95 Foreign loss component and starting total retained after transfer to head company  
770-95
Where a tax loss having a foreign loss component is transferred under Subdivision 707-A of the 1997 Act to a head company:

(a) the tax loss has the same amount of foreign loss component after the transfer as it had immediately before the transfer; and

(b) the starting total for the loss parcel to which the tax loss belongs (see section 770-20 ) is the same after the transfer as it was immediately before the transfer.

(c) (Repealed by No 88 of 2009)

Note:

This section ensures a tax loss retains its foreign loss component and starting total even though the head company is taken, after the transfer, to have made the loss for the income year in which the transfer occurs.

S 770-95 amended by No 88 of 2009, s 3 and Sch 5 items 270 to 272, by substituting " transfer. " for " transfer; and " in para (b), repealing para (c) and substituting the note for notes 1 and 2, applicable in relation to income years, statutory accounting periods and notional accounting periods starting on or after 1 July 2008. Para (c) and notes 1 and 2 formerly read:

(c) for the purposes of section 770-30 , the amount of the foreign loss component of one or more of the tax losses in the parcel that any entity has deducted for an income year is the same after the transfer as immediately before the transfer.

Note 1:

This section ensures a tax loss retains its foreign loss component, starting total and deduction history even though the head company is taken after the transfer to have made the loss for the income year in which the transfer occurs.

Note 2:

Section 770-30 sets a limit on how much of an entity ' s past foreign losses may be deducted in each of the first 4 years after the commencement of this section.

S 770-95 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.