Taxation Laws Amendment Act (No. 2) 1995 (169 of 1995)

Schedule 2   EMPLOYEE SHARE SCHEMES

Part 1   INCOME TAX ASSESSMENT ACT 1936

Division 2   Other amendments of the Income Tax Assessment Act 1936

8   After section 530

Insert in Division 16 of Part XI:

Reduction of foreign investment fund income because of employee share

scheme shares or rights

"530A.(1) If:

(a) a taxpayer acquired a qualifying share or right under an

employee share scheme and has not made an election under section 139E

for the year of income in which the share or right is acquired; and

(b) there is a period (the reduction period) forming the whole or

part of a notional accounting period of a FIF in respect of which the

following conditions are satisfied:

(i) the taxpayer holds the share or right;

(ii) the share or right is an interest in the FIF;

(iii) the cessation time for the share or right has not occurred;

the foreign investment fund income of the taxpayer for the notional

accounting period is to be reduced by an amount equal to any increase

in the market value of the share or right during the reduction period.

"(2) In the section, cessation time, market value, qualifying right

and qualifying share have the same meanings as in Division 13A of Part

III.".