INCOME TAX ASSESSMENT ACT 1936 (ARCHIVE)

PART IIIA - CAPITAL GAINS AND CAPITAL LOSSES  

Division 3 - Determination of capital gains and capital losses  

SECTION 160ZK   REDUCTION OF AMOUNTS FOR THE PURPOSES OF REDUCED COST BASE  

160ZK(1)   [Reduced amounts for purposes of sec 160ZH(3)]  

Subject to subsection (1B), a reference in subsection 160ZH(3) to the reduced amount of any consideration, the reduced amount of incidental costs, or the reduced amount of any expenditure, in respect of an asset (other than the taxpayer's interest in a partnership asset of a partnership in which the taxpayer is a partner) is a reference to the sum of -

(a) the amount of the consideration, the amount of the costs or the amount of the expenditure, as the case may be, reduced by any part of the consideration, of the costs or of the expenditure that:

(i) has been allowed or is allowable as a deduction to the taxpayer; or

(ii) would, but for section 61 of this Act, have been so allowable; or

(iii) would be taken into account under paragraph (b) of the definition of undeducted cost in section 42-175 of the Income Tax Assessment Act 1997 ; or

(iv) would be taken into account under paragraph 58-80(c) or 58-145(5)(b) of the Income Tax Assessment Act 1997 ; and

(b) any amount that, as a result of the disposal of the asset by the taxpayer, is included in the assessable income of the taxpayer of any year of income by virtue of a provision of this Act other than this Part and is attributable to the part of the consideration, the part of the costs or the part of the expenditure, as the case may be, that was allowed or is allowable as a deduction.

160ZK(1A)   [Deduction allowable to taxpayer]  

The reference in paragraph (1)(a) to any part of the consideration, of the costs or of the expenditure that has been allowed or is allowable as a deduction to the taxpayer in respect of any year of income includes:

(a) an amount that, apart from subsections 124ZB(4) and 124ZG(5), would have been so allowed or allowable under Division 10C or 10D of Part III of this Act; and

(b) an amount that, apart from paragraph 43-70(2)(h) of the Income Tax Assessment Act 1997 , would have been so allowed or allowable under Division 43 of that Act; and

(c) an amount that, apart from subsection 388-55(3) of the Income Tax Assessment Act 1997 , would have been so allowed or allowable under Subdivision 387-A or 387-B of that Act.

160ZK(1B)   [Reduction of subsec(1) amount]  

If the asset is a share, the amount worked out under subsection (1) is to be reduced by any rebatable dividend adjustment that arises in relation to the share (see subsection (5)).

160ZK(2)   [Amount included in assessable income]  

The reference in paragraph (1)(b) to an amount that is included in the assessable income of a taxpayer includes a reference to an amount:

(a) that is taken by subsection 60(1A) of this Act to be so included for the asset for the purposes of subsection 60(1) ; or

(b) that is treated as being deducted for depreciation of another asset under section 42-285 or 42-290 of the Income Tax Assessment Act 1997 .

160ZK(3)   [Reduced amount re partnership asset]  

Subject to subsection (3B), a reference in subsection 160ZH(3) to the reduced amount of any consideration, the reduced amount of incidental costs, or the reduced amount of any expenditure, in respect of an asset (in this subsection called the ``taxpayer's asset'' ), being a taxpayer's interest in a partnership asset of a partnership in which the taxpayer is a partner, is a reference to the sum of:

(a) the amount of the consideration, the amount of the costs or the amount of the expenditure, as the case may be, reduced by any part of the consideration, of the costs or of the expenditure that:

(i) has been allowed or is allowable as a deduction to the partnership; or

(ii) would, but for section 61 of this Act, have been so allowable; or

(iii) would be taken into account under paragraph (b) of the definition of undeducted cost in section 42-175 of the Income Tax Assessment Act 1997 ; or

(iv) would be taken into account under paragraph 58-80(c) or 58-145(5)(b) of the Income Tax Assessment Act 1997 ; and

(b) any amount that, as a result of the disposal of the taxpayer's asset by the taxpayer, is included in the assessable income of the partnership of any year of income by virtue of a provision of this Act other than this Part and is attributable to the part of the consideration, the part of the costs or the part of the expenditure, as the case may be, that was allowed or is allowable as a deduction.

160ZK(3A)   [Included amounts]  

The reference in paragraph (3)(a) to any part of the consideration, of the costs or of the expenditure that has been allowed or is allowable as a deduction to the partnership in respect of any year of income includes:

(a) an amount that, apart from subsections 124ZB(4) and 124ZG(5), would have been so allowed or allowable under Division 10C or 10D of Part III of this Act; and

(b) an amount that, apart from paragraph 43-70(2)(h) of the Income Tax Assessment Act 1997 , would have been so allowed or allowable under Division 43 of that Act.

160ZK(3B)   [Reduction of subsec (3) amount]  

If the asset is a share, the amount worked out under subsection (3) is to be reduced by any rebatable dividend adjustment that arises in relation to the share (see subsection (5)).

160ZK(4)   [Amount included in partnership's assessable income]  

The reference in paragraph (3)(b) to an amount that is included in the assessable income of the partnership includes a reference to an amount:

(a) that is taken by subsection 60(1A) of this Act to be so included for the asset for the purposes of subsection 60(1) ; or

(b) that is treated as being deducted for depreciation of another asset under section 42-285 or 42-290 of the Income Tax Assessment Act 1997 .

160ZK(5)   [Rebatable dividend adjustment]  

A rebatable dividend adjustment arises in relation to a share (the ``RDA share'' ) if:

(a) under an arrangement, a company makes a distribution to the holder of the RDA share; and

(b) an amount (the ``attributable amount'' ), being the whole or a part of the distribution, could reasonably be taken to be attributable to profits that were derived by the company before the holder acquired the RDA share; and

(c) the holder of the RDA share is entitled to a rebate of tax (the ``dividend rebate'' ) in the holder's assessment for a year of income under section 46 or 46A in respect of an amount (the ``dividend amount'' ) being so much of the distribution as is a dividend; and

(d) the holder of the RDA share is, at any time during the period in which the arrangement is made or carried out, a controller of the company or an associate of a controller of the company.

160ZK(6)   [Amount of rebatable dividend adjustment]  

The amount of a rebatable dividend adjustment arising in relation to the share under subsection (5) is:

Attributable amount

×

Amount of the dividend rebate     Dividend     General company     amount     ×       tax rate

160ZK(7)   [Definitions]  

In this section:

"associate"
has the same meaning as in section 160ZZRN ;

"controller"
has the same meaning as in section 160ZZRN .