Income Tax Assessment Act 1997

CHAPTER 2 - LIABILITY RULES OF GENERAL APPLICATION  

PART 2-10 - CAPITAL ALLOWANCES: RULES ABOUT DEDUCTIBILITY OF CAPITAL EXPENDITURE  

Division 45 - Disposal of leases and leased plant  

Operative provisions  

SECTION 45-15   Disposal of shares in 100% subsidiary that leases plant  

45-15(1)    

A company (the former subsidiary ) is treated as if it had disposed of ^* plant, received its *market value for that disposal and immediately reacquired it for the same amount if:

(a) the former subsidiary has deducted or can deduct an amount for the decline in value of the plant; and

(b) the former subsidiary was a ^* 100% subsidiary of another company in a ^* wholly-owned group at a time when it ^* held the plant; and

(c) for most of the time when the former subsidiary held the plant, the plant was leased to another entity; and

(d) the main ^* business of the former subsidiary was to lease assets; and

(e) all or part of the lease period occurred on or after 22 February 1999; and

(f) on or after that day, the direct or indirect beneficial ownership of more than 50% of the ^* shares in the former subsidiary is acquired by an entity or entities none of which is a member of the wholly-owned group; and

(g) the plant ' s ^* written down value at the time of that acquisition is less than its market value at that time.

45-15(2)    
However, the former subsidiary is not treated as if it had disposed of ^* plant and reacquired it if the main business of each of the entities that acquired the direct or indirect beneficial ownership of ^* shares in the former subsidiary is the same as the main business of the ^* wholly-owned group of which the former subsidiary was a member.

45-15(3)    
The disposal and reacquisition of the ^* plant:

(a) is taken to have occurred when that direct or indirect beneficial ownership was acquired; and

(b) is taken not to have affected any lease of the plant.

45-15(4)    

(Repealed by No 77 of 2001)