INCOME TAX ASSESSMENT ACT 1936 (ARCHIVE)

PART III - LIABILITY TO TAXATION  

Division 10C - Deductions for capital expenditure on traveller accommodation  

SECTION 124ZE   DEDUCTION IN RESPECT OF DESTRUCTION OF BUILDING  

124ZE(1)   [Total destruction of hotel part]  

Subject to this section and section 124ZD , where:

(a) there is an amount of qualifying hotel expenditure in respect of a building;

(b) during a year of income, the hotel part is destroyed;

(c) immediately before the destruction, a taxpayer owned the hotel part or a part (in this subsection referred to as the relevant part ) of the hotel part;

(d) at any time before the destruction, the taxpayer used the hotel part or the relevant part, as the case may be, in the prescribed manner;

(e) if the taxpayer did not use the hotel part or the relevant part, as the case may be, in the eligible manner immediately before the time of the destruction, no part of the hotel part or of the relevant part, as the case may be, that, at the time (in this paragraph referred to as the relevant time ) when the hotel part or the relevant part, as the case may be, was last used in the eligible manner, was used for the purpose of operating a hotel, motel or guest house was used by any person for any purpose after the relevant time and before the time of the destruction;

(f) in a case where the taxpayer owned the whole of the hotel part immediately before the time of the destruction, so much of the residual capital expenditure at that time in relation to the amount of qualifying hotel expenditure as is attributable to the hotel part exceeds the amount (if any) received or receivable by the taxpayer (under a policy of insurance or otherwise) in respect of the destruction of the hotel part; and

(g) in a case where the taxpayer owned a part only of the hotel part immediately before the time of the destruction, so much of the residual capital expenditure at that time in relation to the amount of qualifying hotel expenditure as is attributable to the relevant part exceeds the amount (if any) received or receivable by the taxpayer (under a policy of insurance or otherwise) in respect of the destruction of the relevant part,

the taxpayer is entitled, in his assessment in respect of income of the year of income, to a deduction of an amount equal to:

(h) in a case to which paragraph (f) applies - the excess referred to in that paragraph; and

(j) in a case to which paragraph (g) applies - the excess referred to in that paragraph.

124ZE(2)   [Partial destruction of hotel part]  

Subject to this section and section 124ZD , where:

(a) there is an amount of qualifying hotel expenditure in respect of a building;

(b) during a year of income, a part (in this subsection referred to as the destroyed part ) of the hotel part is destroyed;

(c) immediately before the destruction, a taxpayer owned the destroyed part or a part (in this subsection referred to as the relevant part ) of the destroyed part;

(d) at any time before the destruction, the taxpayer used the destroyed part or the relevant part, as the case may be, in the prescribed manner;

(e) if the taxpayer did not use the destroyed part or the relevant part, as the case may be, in the eligible manner immediately before the time of the destruction, no part of the destroyed part or of the relevant part, as the case may be, that, at the time (in this paragraph referred to as the relevant time ) when the destroyed part or the relevant part, as the case may be, was last used in the eligible manner, was used for the purpose of operating a hotel, motel or guest house was used by any person for any purpose after the relevant time and before the time of the destruction;

(f) in a case where the taxpayer owned the whole of the destroyed part immediately before the time of the destruction, so much of the residual capital expenditure at that time in relation to the amount of qualifying hotel expenditure as is attributable to the destroyed part exceeds the amount (if any) received or receivable by the taxpayer (under a policy of insurance or otherwise) in respect of the destruction of the destroyed part; and

(g) in a case where the taxpayer owned a part only of the destroyed part immediately before the time of the destruction, so much of the residual capital expenditure at that time in relation to the amount of qualifying hotel expenditure as is attributable to the relevant part exceeds the amount (if any) received or receivable by the taxpayer (under a policy of insurance or otherwise) in respect of the destruction of the relevant part,

the taxpayer is entitled, in his assessment in respect of income of the year of income, to a deduction of an amount equal to:

(h) in a case to which paragraph (f) applies - the excess referred to in that paragraph; and

(j) in a case to which paragraph (g) applies - the excess referred to in that paragraph.

124ZE(3)   [Total destruction of apartment part]  

Subject to this section and section 124ZD , where:

(a) there is an amount of qualifying apartment expenditure in respect of a building;

(b) during a year of income, the apartment part is destroyed;

(c) immediately before the destruction, a taxpayer owned the apartment part or a part (in this subsection referred to as the relevant part ) of the apartment part;

(d) at any time before the destruction, the taxpayer used the apartment part or the relevant part, as the case may be, in the prescribed manner;

(e) if the taxpayer did not use the apartment part or the relevant part, as the case may be, in the eligible manner immediately before the time of the destruction, no part of the apartment part or of the relevant part, as the case may be, that, at the time (in this paragraph referred to as the relevant time ) when the apartment part or the relevant part, as the case may be, was last used in the eligible manner, was used, or made available for use, for, or in association with, the provision of short-term accommodation for travellers was used by any person for any purpose after the relevant time and before the time of the destruction;

(f) in a case where the taxpayer owned the whole of the apartment part immediately before the time of the destruction, so much of the residual capital expenditure at that time in relation to the amount of qualifying apartment expenditure as is attributable to the apartment part exceeds the amount (if any) received or receivable by the taxpayer (under a policy of insurance or otherwise) in respect of the destruction of the apartment part; and

(g) in a case where the taxpayer owned a part only of the apartment part immediately before the time of the destruction, so much of the residual capital expenditure at that time in relation to the amount of qualifying apartment expenditure as is attributable to the relevant part exceeds the amount (if any) received or receivable by the taxpayer (under a policy of insurance or otherwise) in respect of the destruction of the relevant part,

the taxpayer is entitled, in his assessment in respect of income of the year of income, to a deduction of an amount equal to:

(h) in a case to which paragraph (f) applies - the excess referred to in that paragraph; and

(j) in a case to which paragraph (g) applies - the excess referred to in that paragraph.

124ZE(4)   [Partial destruction of apartment part]  

Subject to this section and section 124ZD , where:

(a) there is an amount of qualifying apartment expenditure in respect of a building;

(b) during a year of income, a part (in this subsection referred to as the destroyed part ) of the apartment part is destroyed;

(c) immediately before the destruction, a taxpayer owned the destroyed part or a part (in this subsection referred to as the relevant part ) of the destroyed part;

(d) at any time before the destruction, the taxpayer used the destroyed part or the relevant part, as the case may be, in the prescribed manner;

(e) if the taxpayer did not use the destroyed part or the relevant part, as the case may be, in the eligible manner immediately before the time of the destruction, no part of the destroyed part or of the relevant part, as the case may be, that, at the time (in this paragraph referred to as the relevant time ) when the destroyed part or the relevant part, as the case may be, was last used in the eligible manner, was used, or made available for use, for, or in association with, the provision of short-term accommodation for travellers was used by any person for any purpose after the relevant time and before the time of the destruction of the destroyed part;

(f) in a case where the taxpayer owned the whole of the destroyed part immediately before the time of the destruction, so much of the residual capital expenditure at that time in relation to the amount of qualifying apartment expenditure as is attributable to the destroyed part exceeds the amount (if any) received or receivable by the taxpayer (under a policy of insurance or otherwise) in respect of the destruction of the destroyed part; and

(g) in a case where the taxpayer owned a part only of the destroyed part immediately before the time of the destruction, so much of the residual capital expenditure at that time in relation to the amount of qualifying apartment expenditure as is attributable to the relevant part exceeds the amount (if any) received or receivable by the taxpayer (under a policy of insurance or otherwise) in respect of the destruction of the relevant part,

the taxpayer is entitled, in his assessment in respect of income of the year of income, to a deduction of an amount equal to:

(h) in a case to which paragraph (f) applies - the excess referred to in that paragraph; and

(j) in a case to which paragraph (g) applies - the excess referred to in that paragraph.

124ZE(5)   [Disposal of salvaged property]  

Where:

(a) a building or a part of a building is destroyed; and

(b) an amount is received or receivable by a person who, immediately before the time of the destruction, owned the whole or a part of the building in respect of the disposal of any property (in this subsection referred to as the relevant property ) that, immediately before the destruction, formed part of the building or of that part of the building, as the case may be, that was destroyed,

the amount so received or receivable, reduced by any demolition costs incurred in respect of the relevant property, shall be taken to be an amount received or receivable by the person in respect of the destruction of the property of which the relevant property so formed part.

124ZE(6)   [Dissection of amount receivable]  

Where:

(a) an amount is received or receivable by a person under a policy of insurance or otherwise in respect of the destruction of property; and

(b) it is required to be determined for the purposes of this Division how much of the amount received or receivable was received or is receivable in respect of part of the property referred to in paragraph (a),

so much of the amount referred to in paragraph (a) as, in the opinion of the Commissioner, relates to the part of the property referred to in paragraph (b) shall be taken to have been received or to be receivable, as the case may be, by the person in respect of the part of the property referred to in paragraph (b).

124ZE(7)   [Hotel or apartment part used in eligible manner]  

For the purposes of the application of this section to an amount of qualifying hotel expenditure or qualifying apartment expenditure in respect of a building, a part of the building is taken to be used in an eligible manner if:

(a) in the case of pre-18 July 1985 qualifying hotel expenditure or pre-18 July 1985 qualifying apartment expenditure - the part of the building was used in the prescribed manner; or

(b) in the case of post-26 February 1992 qualifying hotel expenditure or post-26 February 1992 apartment expenditure - the part of the building was used for the purpose of producing assessable income.