Indirect Tax Legislation Amendment Act 2000 (92 of 2000)

Schedule 11   Other amendments

A New Tax System (Goods and Services Tax) Act 1999

11H   After Division 138

Insert:

Division 139 - Distributions from deceased estates

139-1 What this Division is about

Distributions from deceased estates, for private consumption, that are not taxable supplies may involve disposing of assets that were acquired or imported in circumstances giving rise to entitlements to input tax credits. This Division provides for an increasing adjustment to cancel those input tax credits.

139-5 Adjustments for distributions from deceased estates

(1) You have an increasing adjustment if:

(a) you are the executor or trustee of a deceased estate; and

(b) you are *registered or *required to be registered; and

(c) you supply an asset of the deceased estate to a beneficiary of the deceased estate; and

(d) the supply is not a *taxable supply and is not a supply that is *GST-free or *input taxed; and

(e) you were, or are, or the deceased person was, entitled to an input tax credit for the deceased person's acquisition or importation of the asset.

Note: Increasing adjustments increase your net amounts.

(2) The amount of the adjustment, for the asset, is as follows:

(1 / 11) * Actual application of the thing * Applicable value

where:

applicable value is:

(a) the *GST inclusive market value of the asset immediately before it is supplied; or

(b) if you were, or are, or the deceased person was, entitled to an input tax credit for the deceased person acquiring the thing - the amount of the *consideration that you or the deceased person provided, or was liable to provide, for the acquisition of the thing, but only if the amount is less than that value; or

(c) if you were, or are, or the deceased person was, entitled to an input tax credit for the deceased person importing the thing - the cost to you or the deceased person of acquiring or producing the thing (plus the GST paid on its importation), but only if the amount is less than that value.

(3) However, an *adjustment does not arise under this section in respect of the asset if:

(a) the asset related to an *enterprise that the deceased person *carried on, and the beneficiary intends to continue to carry on that enterprise; or

(b) there were one or more *adjustment periods for the deceased person's acquisition or importation of the asset, and the last of those adjustment periods has ended before the cancellation of your *registration takes effect.

139-10 Attributing adjustments for distributions from deceased estates

(1) An *adjustment that you have under this Division is attributable to the tax period in which it arises.

(2) This section has effect despite section 29-20 (which is about attributing your adjustments).

139-15 Application of Division 129

This Division does not affect the operation of Division 129 (which is about changes in the extent of creditable purpose).