INCOME TAX ASSESSMENT ACT 1936 (ARCHIVE)

PART IIIA - CAPITAL GAINS AND CAPITAL LOSSES  

Division 3A - Net capital gain or net capital loss of company in respect of year of income in which ownership or control of the company changed  

Working out the company's net capital gain or net capital loss  

SECTION 160ZNE   FIRST, DIVIDE THE YEAR OF INCOME INTO PERIODS  

160ZNE(1)   [Each period of year treated as a year of income]  

Divide the year of income into periods and treat each period as a year of income as follows.

160ZNE(2)   [First period]  

The first period starts at the start of the year of income. Each later period starts immediately after the end of the previous period.

160ZNE(3)   [Last period]  

The last period ends at the end of the year of income. Each period (except the last) ends at the earlier of:

(a) the latest time that would result in persons having more than a 50% stake in the company during the whole of the period; or

(b) the earliest time when a person begins to control, or becomes able to control, the voting power in the company (whether directly, or indirectly through one or more interposed entities) for the purpose, or for purposes including the purpose, of:

(i) getting some benefit or advantage to do with how this Act applies; or

(ii) getting such a benefit or advantage for someone else.

160ZNE(4)   [Successive periods]  

However, what would otherwise be 2 or more successive periods are treated as a single period if the company satisfies the same business test for all of them, considered as a single period (the same business test period ). Apply the same business test to the business the company carried on immediately before the end of the first of the periods (the test time ).

Note:

For the same business test: see Division 3C.

160ZNE(5)   [Calculate gain or loss]  

Treat each period as if it were a year of income and work out the notional net capital gain or notional net capital loss in respect of that period.