Income Tax Assessment Act 1936
View history note
Hide history noteType of trust to which this section applies - case 1
266-85(1)
This section applies to a trust that:
(a) can deduct in the income year an amount:
(i) under section 51 or 63 , or under section 8-1 or 25-35 of the Income Tax Assessment Act 1997 , in respect of the writing off of the whole or part of a debt as bad; or
(ii) under subsection 63E(3) or (4) in respect of a debt/equity swap relating to the whole or part of a debt; and
(b) was an unlisted widely held trust at all times in the period (the test period ):
(i) if the debt was incurred in an earlier income year - beginning on the day the debt was incurred and ending at the end of the income year; or
(ii) if the debt was incurred in the income year - consisting of the income year; and
(c) was not a wholesale widely held trust at all times in the test period; and
(d) was not an unlisted very widely held unit trust at all times in the test period; and
(e) was not an excepted trust at all times in the test period.
Type of trust to which this section applies - case 2
266-85(2)
This section also applies to a trust that:
(a) can deduct in the income year an amount:
(i) under section 51 or 63 , or under section 8-1 or 25-35 of the Income Tax Assessment Act 1997 , in respect of the writing off of the whole or part of a debt as bad; or
(ii) under subsection 63E(3) or (4) in respect of a debt/equity swap relating to the whole or part of a debt; and
(b) was an unlisted widely held trust, other than an unlisted very widely held trust or a wholesale widely held trust, at some time in the period (the test period ):
(i) if the debt was incurred in an earlier income year - beginning on the day the debt was incurred and ending at the end of the income year; or
(ii) if the debt was incurred in the income year - consisting of the income year; and
(c) was a listed widely held trust at all other times in the test period; and
(d) was not an excepted trust at all times in the test period.
Condition for deducting amount
266-85(3)
The trust cannot deduct the amount unless it meets the condition in section 266-90 .
Note:
Subdivisions 709-D and 719-I of the Income Tax Assessment Act 1997 also affect when a trust that used to be a member of a consolidated group or MEC group may deduct a debt that used to be owed to a member of the group and that the trust writes off as bad.
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