Income Tax Assessment Act 1997

CHAPTER 6 - THE DICTIONARY  

PART 6-1 - CONCEPTS AND TOPICS  

Division 974 - Debt and equity interests  

Subdivision 974-B - Debt interests  

SECTION 974-45   Valuation of financial benefits - convertible interests  

974-45(1)    
This section deals with the situation in which a *scheme gives rise to an *interest that will or may convert into an *equity interest in a company.

974-45(2)    
The life of the interest ends no later than the time when it converts into that *equity interest.

974-45(3)    
The possibility of the conversion is to be disregarded in working out the length of the life of the interest arising from the *scheme for the purposes of section 974-35 if it is uncertain:


(a) whether the interest will ever convert; or


(b) when the interest will convert.

Note:

Section 974-40 deals with the situation in which a party to the scheme may exercise a right or option to convert the interest.


974-45(4)    
This section does not limit subsection 974-35(2) .



 

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