Income Tax Assessment Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES

PART 3-1 - CAPITAL GAINS AND LOSSES: GENERAL TOPICS

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Division 115 - Discount capital gains and trusts ' net capital gains

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Subdivision 115-C - Rules about trusts with net capital gains

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Operative provisions

SECTION 115-225 Attributable gain

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115-225(1)
The amount is the product of:

(a) the amount of the *capital gain remaining after applying steps 1 to 4 of the method statement in subsection 102-5(1) ; and

(b) your *share of the capital gain (see section 115-227 ), divided by the amount of the capital gain.

115-225(2)
Subsection (3) applies if the net income of the trust estate (disregarding the amount of any *franking credits) for the relevant income year falls short of the sum of:

(a) the *net capital gain (if any) of the trust estate for the income year; and

(b) the total of all *franked distributions (if any) included in the assessable income of the trust estate for the income year (to the extent that an amount of the franked distributions remained after reducing them by deductions that were directly relevant to them).

115-225(3)
For the purposes of subsection (1), replace paragraph (a) of that subsection with the following paragraph:

(a) the product of:

(i) the amount of the *capital gain remaining after applying steps 1 to 4 of the method statement in subsection 102-5(1) ; and

(ii) the *net income of the trust estate for that income year (disregarding the amount of any *franking credits), divided by the sum mentioned in subsection (2); and

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History

S 115-225 substituted by No 62 of 2011, s 3 and Sch 2 item 11, effective 29 June 2011. For application provisions see note under s 115-200 . S 115-225 formerly read:

SECTION 115-225 Special rule for assessing trustee under section 99A of the Income Tax Assessment Act 1936
Purpose

115-225(1)
The purpose of this section is to reverse the benefit of applying the *discount percentage or the small business 50% reduction under Subdivision 152-C in working out the trust estate ' s net income when the trustee is assessed under section 99A of the Income Tax Assessment Act 1936 on an amount of the net income.

Modification of section 99A

115-225(2)
The trustee is to be assessed (and pay tax) under section 99A of the Income Tax Assessment Act 1936 as if:

(a) if a *capital gain of the trust was reduced under either step 3 of the method statement in subsection 102-5(1) (discount capital gains) or Subdivision 152-C (small business 50% reduction) but not both (even if it was further reduced by the other small business concessions in Subdivisions 152-D and 152-E ) - the part of the amount that is attributable to the trust estate ' s capital gain were double the amount that it actually is; and

(b) if a capital gain was reduced under both step 3 of the method statement and Subdivision 152-C (even if it was further reduced by the other small business concessions) - the part of the amount that is attributable to the trust estate ' s gain were 4 times the amount that it actually is.

S 115-225 substituted by No 165 of 1999 and inserted by No 169 of 1999.

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