Income Tax Assessment Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES

PART 3-3 - CAPITAL GAINS AND LOSSES: SPECIAL TOPICS

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Division 124 - Replacement-asset roll-overs

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Subdivision 124-R - Water entitlements

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History

Subdiv 124-R inserted by No 136 of 2010 , s 3 and Sch 2 item 6, applicable to CGT events that occur in the 2005-06 income year and later income years. No 136 of 2010 , s 3 and Sch 2 item 10 contains the following transitional provisions:

Transitional provisions - water entitlement roll-overs
(1)
Subsection 124-1105(1) and section 124-1135 of the Income Tax Assessment Act 1997 , as inserted, do not apply to you if:

(a) you stopped owning one or more water entitlements at any time in the period (the relevant period ):

(i) starting at the start of the 2005-06 income year; and

(ii) ending on 7 December 2010; and

(b) you choose that those provisions do not apply to you.

(2)
Section 124-1155 of the Income Tax Assessment Act 1997 , as inserted, does not apply to you if:

(a) the CGT event happened at any time in the period (the relevant period ):

(i) starting at the start of the 2005-06 income year; and

(ii) ending on 7 December 2010; and

(b) you choose that those provisions do not apply to you.

(3)
A choice under subitem (1) or (2) must be made by the later of:

(a) 12 months after 7 December 2010; and

(b) the time within which the Commissioner may, under section 170 of the Income Tax Assessment Act 1936 , amend your assessment for the income year in which the relevant period occurred.

Replacement case

SECTION 124-1115 Roll-over consequences - partial roll-over

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124-1115(1)
You can obtain only a partial roll-over in relation to an original entitlement if the *capital proceeds for that entitlement includes something (the ineligible proceeds ) other than a new entitlement or new entitlements. There is no roll-over for that part (the ineligible part ) of the entitlement for which you received the ineligible proceeds.

Note:

If the roll-over is under subsection 124-1105(2) , some or all of the original entitlements may each have an ineligible part.

124-1115(2)
The *cost base of the ineligible part is that part of the cost base of the original entitlement as is reasonably attributable to the ineligible part.

124-1115(3)
The *reduced cost base of the ineligible part is worked out similarly.

124-1115(4)
In working out what is reasonably attributable to the ineligible part for the purposes of subsections (2) and (3), have regard to the *market value of the new entitlement relative to the market value of the ineligible proceeds.

124-1115(5)
If the roll-over is under subsection 124-1105(2) , for the purposes of sections 124-1120 and 124-1130 , for each original entitlement that has an ineligible part:

(a) reduce the *cost base of that entitlement (just before you stopped owning it) by so much of that cost base as is attributable to that ineligible part; and

(b) reduce the *reduced cost base of that entitlement similarly.

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