Income Tax Assessment Act 1997
View history note
Hide history noteCGT event F5 happens if a lessor receives a payment from the lessee for agreeing to vary or waive a term of the lease.
The payment can include giving property: see section 103-5 .
104-130(2)
The time of the event is when the term is varied or waived.
104-130(3)
The lessor makes a capital gain if the *capital proceeds from the event are more than the expenditure the lessor incurs in relation to the variation or waiver. The lessor makes a capital loss if those capital proceeds are less .
Example:
You own a shopping centre. The lessee of a shop in the centre pays you $10,000 for agreeing to change the terms of its lease. You incur expenses of $1,000 for a solicitor and $500 for a valuer. You make a capital gain of $8,500.
104-130(4)
The expenditure can include giving property: see section 103-5 . However, it does not include an amount you have received as *recoupment of it and that is not included in your assessable income.
Exceptions
104-130(5)
A *capital gain or *capital loss the lessor makes is disregarded if:
(a) the lease was granted before 20 September 1985; or
(b) for a lease that has been renewed or extended - the start of the last renewal or extension occurred before that day.
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