Income Tax Assessment Act 1936

PART III - LIABILITY TO TAXATION  

Division 16E - Accruals assessability, etc., in respect of certain security payments  

SECTION 159GT   TAX TREATMENT OF ISSUER OF A QUALIFYING SECURITY  

159GT(1)   [Taxpayer issuer of qualifying security]  

Subsections (1A) and (1B) apply if a taxpayer is an issuer of a qualifying security to which this section applies during a period (the ``issuer period'' ) comprising the whole or part of a year of income.

159GT(1A)   [Allowable deduction]  

If, on the assumptions in subsection (1C), an amount would be included in the taxpayer's assessable income of the year of income in respect of the issuer period, then, subject to this section, the taxpayer is entitled to a deduction in his or her assessment for the year of income equal to that amount.

159GT(1B)   [Amount included in assessment]  

If, on the assumptions in subsection (1C), a deduction would be allowable in the taxpayer's assessment for the year of income, then an amount equal to the deduction is included in the taxpayer's assessable income of the year of income.

159GT(1C)   [Assumptions]  

For the purposes of subsections (1A) and (1B), the assumptions are that:

(a) the security was issued to the taxpayer (rather than the taxpayer being the issuer of the security); and

(b) the taxpayer held the security during the whole of the issuer period; and

(c) the taxpayer did not transfer the security at the end of the issuer period; and

(d) sections 159GW , 159GX and 159GY were not enacted.

159GT(2)   [Limits on deduction]  

A deduction is not allowable to a taxpayer under subsection (1A) in relation to a qualifying security to which this section applies unless the taxpayer would, but for this Division, be entitled to a deduction under section 8-1 of the Income Tax Assessment Act 1997 in respect of payments (not being redemption payments, partial redemption payments or periodic interest payments) made or liable to be made under the security in respect of the relevant period referred to in that subsection.

159GT(3)   [Deductions under this section]  

Where a payment (not being a payment that is, or to the extent that it consists of, a periodic interest payment, a redemption payment or a partial redemption payment) is made or liable to be made in a year of income by a taxpayer under a qualifying security to which this section applies, no amount shall be allowable as a deduction from the assessable income of the taxpayer of the year of income in respect of the payment otherwise than under this section.

159GT(4)    

(Omitted by No 82 of 1994)

159GT(5)   [Securities to which section applies]  

Subject to subsection (6), this section applies to:

(a) any qualifying security issued on or before 22 May 1986; and

(b) any qualifying security issued in Australia after 22 May 1986 other than a negotiable instrument issued payable to bearer.

159GT(6)   [Securities to which section does not apply]  

This section does not apply to a qualifying security issued by a taxpayer after 5 o'clock in the evening, by standard time in the Australian Capital Territory, on 23 April 1987:

(a) to, on behalf of or otherwise for the benefit of, a non-resident or a prescribed dual resident associate of the taxpayer; or

(b) subject to an agreement between the taxpayer and an associate of the taxpayer under which the security is or was to be transferred to a non-resident or a prescribed dual resident associate of the taxpayer.