INCOME TAX ASSESSMENT ACT 1936 (ARCHIVE)

PART XII - DROUGHT INVESTMENT ALLOWANCE  

Division 2 - Primary producer deduction  

Subdivision B - Loss of entitlement to deduction  

SECTION 635   RECOUPMENT OF EXPENDITURE  

635(1A)   [Limited application]  

This section does not apply to an amount received in the 1997-98 year of income or a later year of income if the amount is received as recoupment as defined by section 20-25 of the Income Tax Assessment Act 1997 .

Note:

Subdivision 20-A of the Income Tax Assessment Act 1997 applies instead.

635(1)   [Expenditure deemed not incurred]  

If the taxpayer is, or becomes entitled to be, recouped by any person (whether a government or otherwise) for expenditure for which the deduction is allowable, the taxpayer is taken never to have incurred the expenditure.

635(2)   [Unspecified amount]  

If the taxpayer receives, or becomes entitled to receive, an amount that represents to an unspecified extent:

(a) a recoupment of expenditure (the deductible expenditure ) for which the deduction is allowable; and

(b) a recoupment of other expenditure;

then, for the purposes of subsection (1), the amount is a recoupment of the proportion of the deductible expenditure worked out using the formula:

Deductible expenditure                       Sum of deductible expenditure and other expenditure