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Taxation Laws Amendment Act 1992

Act No. 35 of 1992 as made
An Act to amend the law relating to taxation
Administered by: Treasury
Date of Assent 25 May 1992
Date of repeal 10 Mar 2016
Repealed by Amending Acts 1990 to 1999 Repeal Act 2016
 

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - TABLE OF PROVISIONS

TABLE OF PROVISIONS
PART 1 - PRELIMINARY
Section
1. Short title
2. Commencement
PART 2 - AMENDMENT OF THE FRINGE BENEFITS
TAX ASSESSMENT ACT 1986
3. Principal Act
4. Insertion of new section:
123B. Substantiation requirements not to apply in
special circumstances
5. Amendment of assessments
PART 3 - AMENDMENT OF THE INCOME TAX ASSESSMENT ACT 1936
6. Principal Act
7. Exemptions
8. Index of payments covered by Subdivision
9. Insertion of new section:
24ABNA. Education entry payment
10. Insertion of new section:
45Z. Entitlement to intercorporate dividend
rebate where shareholder is a trustee or
partnership
11. Rebate on dividends
12. Rebate on dividends paid as part of dividend stripping operation
13. Composition of taxable income
14. Losses and outgoings
15. Depreciation
16. Repeal of section 55 and substitution of new sections:
54A. Effective life of property
55. Annual depreciation percentage
17. Calculation of depreciation
18. Limit on cost price for depreciation of motor vehicle
19. Repeal of section 57AG
20. Special depreciation on property used for basic iron or
steel production
21. Insertion of new section:
58. Depreciation roll-over relief for unpooled
property where CGT roll-over relief allowed under
section 160ZZM, 160ZZMA, 160ZZN, 160ZZNA or
160ZZO or where election for roll-over relief
made under section 59AA
22. Disposal, loss or destruction of depreciated property
23. Disposal of depreciated property on change of ownership
or interest
24. Insertion of new sections:
62AAB. Object of pooling of depreciable property
62AAC. Taxpayer may create pools to which depreciable
property may be allocated
62AAD. Pool percentage
62AAE. Allocation of property to a pool
62AAF. Cancellation of allocation to pool -
taxpayer's notice
62AAG. Cancellation of allocation to pool - cessation
of exclusive assessable income-producing use
62AAH. Cancellation of allocation to pool - annual
depreciation percentage not equal to pool
percentage
62AAJ. Cancellation of allocation to pool -
subsequent application of special depreciation
provisions
62AAK. Cancellation of allocation to pool - disposal
to which section 58 applies
62AAL. Effect of cancellation of allocation to pool
62AAM. Reconstruction assumptions and reconstructed
depreciated value
62AAN. Opening balance of pool
62AAO. Closing balance of pool
62AAP. Calculation of depreciation - pooled property
62AAQ. Cancellation of allocation of property to a
pool - effect on subsequent operation of
depreciation provisions
62AAR. Cancellation of allocation of property to pool
- taxpayer must use diminishing value method
to calculate subsequent depreciation
62AAS. No balancing charges/deductions while property
allocated to pool
62AAT. Taxpayer's assessable income to include
proceeds of disposal of pooled property etc.
62AAU. Disposal of pooled property - application of

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CGT provisions
62AAV. Taxpayers may use their own form of words in
pool notices
25. Deductions for debt dividends
26. Expenditure on scientific research
27. Insertion of new section:
73AA. Section 73A roll-over relief where CGT
roll-over relief allowed under section 160ZZM,
160ZZMA, 160ZZN, 160ZZNA or 160ZZO
28. Expenditure on research and development activities
29. Guaranteed returns to investors
30. Losses to be allowable deductions
31. Modified application of Act in relation to certain unit
trusts
32. Modified application of Act in relation to certain unit
trusts
33. Effect of Division on rebate under section 46 or 46A
34. Insertion of new section:
122JAA. Roll-over relief where CGT roll-over relief
allowed under section 160ZZM, 160ZZMA, 160ZZN, 160ZZNA
or 160ZZO or where election for roll-over relief made
under section 122R
35. Insertion of new section:
122JG. Roll-over relief where CGT roll-over relief
allowed under section 160ZZM, 160ZZMA, 160ZZN,
160ZZNA or 160ZZO or where election for
roll-over relief made under section 122R
36. Change in interests in property
37. Insertion of new section:
123BBA. Roll-over relief where CGT roll-over relief
allowed under section 160ZZM, 160ZZMA,
160ZZN, 160ZZNA or 160ZZO or where election
for roll-over relief made under section 123F
38. Insertion of new section:
123BF. Roll-over relief where CGT roll-over relief
allowed under section 160ZZM, 160ZZMA, 160ZZN,
160ZZNA or 160ZZO or where election for
roll-over relief made under section 123F
39. Change in interests in property
40. Insertion of new section:
124AMAA. Roll-over relief where CGT roll-over relief
allowed under section 160ZZM, 160ZZMA,
160ZZN, 160ZZNA or 160ZZO or where election
for roll-over relief made under section
124AO
41. Change in interests in property
42. Interpretation
43. Rehabilitation-related activity
44. No deduction for certain expenditure
45. Insertion of new section:
124GA. Roll-over relief where CGT roll-over relief
allowed under section 160ZZM, 160ZZMA, 160ZZN,
160ZZNA or 160ZZO
46. Insertion of new section and Subdivision:
124JD. Roll-over relief where CGT roll-over relief
allowed under section 160ZZM, 160ZZMA, 160ZZN,
160ZZNA or 160ZZO
Subdivision C - Non-arm's length transactions
124JE. Transactions between persons not at arm's
length
47. Insertion of new section:
124PA. Roll-over relief where CGT roll-over relief
allowed under section 160ZZM, 160ZZMA, 160ZZN,
160ZZNA or 160ZZO or where election for
roll-over relief made under section 122W
48. Disposal of unit of industrial property on change of
partnership etc.
49. Interpretation
50. Indexation of indexed cost base limit
51. Transfer of partnership assets to wholly-owned company
52. Explanation of terms: investment, investor, investment
body
53. Interpretation
54. Credits in respect of deducted amounts
55. Insertion of new section:
221YHZLA. Refunds in relation to certain credit
entitlements
56. Keeping of records
57. Interpretation
58. Insertion of new section:

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327A. Widely distributed finance shares
59. Direct attribution interest in a CFC or CFT
60. Direct attribution account interest in a company
61. Notional allowable deduction for eligible finance share
dividends and widely distributed finance share
dividends
62. Additional notional exempt income - unlisted or listed
country CFC
63. Application of amendments - general
64. Application of depreciation amendments: effective life;
100% depreciation; broadbanding; loading and pooling
65. Application of tax file number amendments
66. Transitional - intercorporate dividend rebate
amendments
67. Transitional - section 55 of the amended Act
68. Transitional - repealed paragraph 56(1)(b) of the
Principal Act
69. Transitional - repealed section 57AH of the Principal
Act
70. Transitional - repealed section 57AL of the Principal
Act
71. Transitional - section 58 of the amended Act
72. Transitional - elective capital deduction roll-over
relief where CGT roll-over relief available under
section 160ZZO of the Principal Act and property
disposed of after 6 December 1990
73. Transitional - section 160AFE of the Principal Act
74. Transitional - Part X record-keeping offences
75. Amendment of assessments
PART 4 - AMENDMENT OF THE INCOME TAX
(INTERNATIONAL AGREEMENTS) ACT 1953
76. Principal Act
77. Schedule 32
78. Application of amendment

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - LONG TITLE

An Act to amend the law relating to taxation

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - PART 1
PART 1 - PRELIMINARY

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 1
Short title

(Assented to 25 May 1992)
1. This Act may be cited as the Taxation Laws Amendment Act 1992.

(Minister's second reading speech made in-
House of Representatives on 19 December 1991
Senate on 26 February 1992)

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 2
Commencement

2. This Act commences on the day on which it receives the Royal Assent.

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - PART 2
PART 2 - AMENDMENT OF THE FRINGE BENEFITS TAX
ASSESSMENT ACT 1986

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 3
Principal Act

3. In this Part, "Principal Act" means the Fringe Benefits Tax Assessment Act 1986.*1*
*1* No. 39, 1986, as amended. For previous amendments, see Nos. 48 and 112, 1986; Nos. 23 and 145, 1987; No. 139, 1987 (as amended by Nos. 11 and 78, 1988); Nos. 6, 78, 95, 97 and 153, 1988; Nos. 2, 11, 97 and 107, 1989; Nos. 58, 60 and 135, 1990; and Nos. 48 and 100, 1991.

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 4

4. After section 123A of the Principal Act the following section is inserted in Part X:
Substantiation requirements not to apply in special circumstances
"123B.(1) If the Commissioner is satisfied that:
(a) a benefit has been provided in, or in respect of, a year of tax in respect of the employment of an employee of an employer; and
(b) it would be unreasonable for the substantiation requirements under this Act in relation to the benefit to apply; the substantiation requirements do not so apply.
"(2) In making a decision under subsection (1), the Commissioner is to have regard to:
(a) the nature and quality of evidence that the employer makes available to substantiate:
(i) if the benefit provided is a fringe benefit - the
taxable value of the fringe benefit; or
(ii) whether the benefit provided is an exempt benefit;
and
(b) special circumstances affecting the employer, including, but not limited to, the following:

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(i) the extent to which the substantiation requirements
were complied with;
(ii) whether the failure to comply with the substantiation
requirements was inadvertent or deliberate.
"(3) The Commissioner may only make a decision under subsection (1):
(a) in the course of reviewing on the Commissioner's own motion the affairs of the employer; or
(b) in considering an objection against the assessment of the employer of the year of tax; or
(c) in considering whether to make an amendment of the assessment of the employer of the year of tax in response to a request made by the employer before the commencement of this section.
"(4) This section does not apply to a declaration made for the purposes of this Act.
"(5) If:
(a) an employer makes an application under subsection 82(1) or (2), as in force immediately before the commencement of section 113 of the Taxation Laws Amendment Act (No. 3) 1991; and
(b) the period mentioned in the subsection concerned ended before the commencement of this section;
the following provisions have effect:
(c) the Commissioner, the Tribunal or the Federal Court of Australia, as the case requires, when making a decision on the application, must disregard subsection (1) of this section;
(d) if the Commissioner, the Tribunal or the Federal Court of Australia, as the case requires, grants the application:
(i) the employer's objection has no effect to the extent
that it relates to grounds based on subsection (1) of this section; and
(ii) the Tribunal or the Federal Court of Australia, when
making a decision under:
(A) paragraph 86A(a) of this Act, as in force
immediately before the commencement of section 113 of the Taxation Laws Amendment Act (No. 3) 1991; or
(B) paragraph 14ZZK(a) or 14ZZO(a) of the Taxation
Administration Act 1953, as the case requires;
must disregard subsection (1) of this section.
"(6) This section applies to a benefit provided before, at or after the commencement of this section.".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 5
Amendment of assessments

5. Section 74 of the Principal Act does not prevent the amendment of an assessment made before the commencement of this section for the purpose of giving effect to this Part.

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - PART 3
PART 3 - AMENDMENT OF THE INCOME TAX ASSESSMENT ACT 1936

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 6
Principal Act

6. In this Part, "Principal Act" means the Income Tax Assessment Act 1936.*2*
*2* No. 27, 1936, as amended. For previous amendments, see No. 88, 1936; No. 5, 1937; No. 46, 1938; No. 30, 1939; Nos. 17 and 65, 1940; Nos. 58 and 69, 1941; Nos. 22 and 50, 1942; No. 10, 1943; Nos. 3 and 28, 1944; Nos. 4 and 37, 1945; No. 6, 1946; Nos. 11 and 63, 1947; No. 44, 1948; No. 66, 1949; No. 48, 1950; No. 44, 1951; Nos. 4, 28 and 90, 1952; Nos. 1, 28, 45 and 81, 1953; No. 43, 1954; Nos. 18 and 62, 1955; Nos. 25, 30 and 101, 1956; Nos. 39 and 65, 1957; No. 55, 1958; Nos. 12, 70 and 85, 1959; Nos. 17, 18, 58 and 108, 1960; Nos. 17, 27 and 94, 1961; Nos. 39 and 98, 1962; Nos. 34 and 69, 1963; Nos. 46, 68, 110 and 115, 1964; Nos. 33, 103 and 143, 1965; Nos. 50 and 83, 1966; Nos. 19, 38, 76 and 85, 1967; Nos. 4, 70, 87 and 148, 1968; Nos. 18, 93 and 101, 1969; No. 87, 1970; Nos. 6, 54 and 93, 1971; Nos. 5, 46, 47, 65 and 85, 1972; Nos. 51, 52, 53, 164 and 165, 1973; No. 216, 1973 (as amended by No. 20, 1974); Nos. 26 and 126, 1974; Nos. 80 and 117, 1975; Nos. 50, 53, 56, 98, 143, 165 and 205, 1976; Nos. 57, 126 and 127, 1977; Nos. 36, 57, 87, 90, 123, 171 and 172, 1978; Nos. 12, 19, 27, 43, 62, 146, 147 and 149, 1979; Nos. 19, 24, 57, 58, 124, 133, 134 and 159, 1980; Nos. 61, 92, 108, 109, 110, 111, 154 and 175, 1981; Nos. 29, 38, 39, 76, 80, 106 and 123, 1982; Nos. 14, 25, 39, 49, 51, 54 and 103, 1983; Nos. 14, 42, 47, 63, 76, 115, 124, 165 and 174, 1984; No. 123, 1984 (as amended by No. 65, 1985); Nos. 47, 49, 104, 123, 168 and 174, 1985; No. 173, 1985 (as amended by No. 49, 1986); Nos. 41, 46, 48, 51, 109, 112 and 154, 1986; No. 49, 1986 (as amended by No. 141, 1987); No. 52, 1986 (as amended by No. 141, 1987); No. 90, 1986 (as amended by No. 141, 1987); Nos. 23, 58, 61, 120, 145 and 163, 1987; No. 62, 1987 (as amended by No. 108, 1987); No. 108, 1987 (as amended by No. 138, 1987); No. 138, 1987 (as amended by No. 11, 1988); No. 139, 1987 (as amended by Nos. 11 and 78, 1988); Nos. 8, 11, 59, 75, 78, 80, 87, 95, 97, 127 and 153, 1988; Nos. 2, 11, 56, 70, 73, 105, 107, 129, 163 and 167, 1989; No. 97, 1989 (as amended by No. 105, 1989); Nos. 20, 35, 45, 57, 58, 60, 61, 87, 119 and 135, 1990; and Nos. 4, 5, 6, 48, 55 and 100, 1991.

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 7
Exemptions

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7. Section 23 of the Principal Act is amended:
(a) by omitting from the end of subparagraph (z)(viii) "or";
(b) by adding at the end of paragraph (z) the following word and subparagraph:
"or (x) an education entry payment received under Part 2.13A of the Social Security Act 1991;";
(c) by omitting from the end of subparagraph (zaa)(v) "or";
(d) by omitting from the end of subparagraph (zaa)(vi) "and" and substituting "or";
(e) by adding at the end of paragraph (zaa) the following subparagraph:
"(vii) an education entry payment received under Part 2.13A of the Social Security Act 1991;".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 8
Index of payments covered by Subdivision

8. Section 24AB of the Principal Act is amended by inserting in the table in the appropriate alphabetical position, determined on a letter-by-letter basis:
"Education entry payment 24ABNA".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 9

9. After section 24ABN of the Principal Act the following section is inserted:
Education entry payment
"24ABNA. Payments of education entry payment under Part 2.13A of the Social Security Act 1991 are not exempt.".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 10

10. Before section 46 of the Principal Act the following section is inserted:
Entitlement to intercorporate dividend rebate where shareholder is a trustee or partnership
(Shareholder a trustee - beneficiary absolutely entitled to share)
"45Z.(1) If:
(a) a share in a company (in this subsection called the 'first company') is held by a shareholder as trustee for another company (in this subsection called the 'second company') who is absolutely entitled to the share as against the trustee; and
(b) the second company is not a taxpayer in the capacity of trustee; and
(c) a dividend is paid to the trustee in respect of the share; and
(d) the whole or a part of an amount included in the second company's assessable income under section 97 (which whole or part is in this subsection called the 'assessable amount') is attributable to that dividend;
sections 46 to 46F (inclusive) apply as if:
(e) the second company were a shareholder in the first company; and
(f) the dividend were paid by the first company to the second company instead of to the trustee; and
(g) the amount of the dividend were equal to the assessable amount; and
(h) the second company's interest in the share were the share in respect of which the dividend was paid; and
(i) a reference to the year of income in which the dividend was paid to the second company were a reference to the year of income to which the assessable amount relates; and
(j) a reference to a specified date or specified time before, on, at or after which the dividend was paid to the second company were a reference to the date or time before, on, at or after which the dividend was paid to the trustee; and
(k) the question of when the share was issued to the second company were answered by reference to the time when the share was issued to the trustee; and
(l) the question of when the share was issued to a person other than the second company were answered by reference to the time when the share was issued to the other person; and
(m) the question whether the payment of the dividend to the second company may reasonably be regarded as equivalent to the payment of interest on a loan were answered by reference to matters relating to the payment of the dividend to the trustee; and
(n) the question of the extent to which the dividend was paid by the first company to the second company out of particular profits were answered by reference to the dividend paid to the trustee; and
(o) the question of the extent to which the dividend paid to the second company was franked were answered by reference to the dividend paid to the trustee; and
(p) the question of when the dividend paid to the second company was declared were answered by reference to the dividend paid to the trustee.
(Shareholder a trustee - beneficiary not absolutely entitled to share)
"(2) If:
(a) a share in a company (in this subsection called the 'first company') is held by a shareholder as trustee of a trust estate; and
(b) a dividend is paid to the trustee in respect of the share; and
(c) the following conditions are satisfied in relation to a taxpayer, being a company (in this subsection called the 'second company'):
(i) the second company is not a taxpayer in the capacity

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of trustee;
(ii) the second company is not absolutely entitled to the
share as against the trustee;
(iii) an amount is included in the assessable income of
the second company of a year of income under subsection 92(1) or section 97 or 100;
(iv) the whole or a part of the amount so included in the
second company's assessable income (which whole or part is in this subsection called the 'assessable amount') is either:
(A) directly attributable to that dividend; or
(B) indirectly attributable to that dividend, through
one or more interposed trusts or partnerships;
sections 46 to 46F (inclusive) apply as if:
(d) the second company were a shareholder in the first company; and
(e) the dividend were paid by the first company to the second company instead of to the trustee; and
(f) the amount of the dividend were equal to the assessable amount; and
(g) if the second company has an interest in the share (whether that interest is held directly or indirectly through one or more interposed trusts or partnerships) - that interest were the share in respect of which the dividend was paid; and
(h) if the second company does not have an interest in the share (including an interest held directly or indirectly through one or more interposed trusts or partnerships):
(i) the second company had an interest in the share; and
(ii) that interest had been acquired by the second company
at the time when the share was acquired by the trustee; and
(iii) that interest were the share in respect of which the
dividend was paid; and
(i) a reference to the year of income in which the dividend was paid to the second company were a reference to the year of income to which the assessable amount relates; and
(j) a reference to a specified date or specified time before, on, at or after which the dividend was paid to the second company were a reference to the date or time before, on, at or after which the dividend was paid to the trustee; and
(k) the question of when the share was issued to the second company were answered by reference to the time when the share was issued to the trustee; and
(l) the question of when the share was issued to a person other than the second company were answered by reference to the time when the share was issued to the other person; and
(m) the question whether the payment of the dividend to the second company may reasonably be regarded as equivalent to the payment of interest on a loan were answered by reference to matters relating to the payment of the dividend to the trustee; and
(n) the question of the extent to which the dividend was paid by the first company to the second company out of particular profits were answered by reference to the dividend paid to the trustee; and
(o) the question of the extent to which the dividend paid to the second company was franked were answered by reference to the dividend paid to the trustee; and
(p) the question of when the dividend paid to the second company was declared were answered by reference to the dividend paid to the trustee.
(Shareholder a partnership - non-trustee partner)
"(3) If:
(a) a share in a company (in this subsection called the 'first company') is held by a partnership in which another company (in this subsection called the 'second company') is a partner; and
(b) the second company is not a taxpayer in the capacity of trustee; and
(c) a dividend is paid to the partnership in respect of the share; and
(d) the whole or a part of an amount included in the second company's assessable income under section 92 (which whole or part is in this subsection called the 'assessable amount') is attributable to that dividend; sections 46 to 46F (inclusive) apply as if:
(e) the second company were a shareholder in the first company; and
(f) the dividend were paid by the first company to the second company instead of to the partnership; and
(g) the amount of the dividend were equal to the assessable amount; and
(h) the second company's interest in the share were the share in respect of which the dividend was paid; and
(i) a reference to the year of income in which the dividend was paid to the second company were a reference to the year of income to which the assessable amount relates; and
(j) a reference to a specified date or specified time before, on, at or after which the dividend was paid to the second company were a reference to the date or time before, on, at or after which the dividend was paid to the partnership; and
(k) the question of when the share was issued to the second company were answered by reference to the time when the share was issued to the partnership; and

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(l) the question of when the share was issued to a person other than the second company were answered by reference to the time when the share was issued to the other person; and
(m) the question whether the payment of the dividend to the second company may reasonably be regarded as equivalent to the payment of interest on a loan were answered by reference to matters relating to the payment of the dividend to the partnership; and
(n) the question of the extent to which the dividend was paid by the first company to the second company out of particular profits were answered by reference to the dividend paid to the partnership; and
(o) the question of the extent to which the dividend paid to the second company was franked were answered by reference to the dividend paid to the partnership; and
(p) the question of when the dividend paid to the second company was declared were answered by reference to the dividend paid to the partnership.
(Shareholder a partnership - trustee partner)
"(4) If:
(a) a share in a company (in this subsection called the 'first company') is held by a partnership; and
(b) a dividend is paid to the partnership in respect of the share; and
(c) the following conditions are satisfied in relation to a taxpayer, being a company (in this subsection called the 'second company'):
(i) the second company is not a taxpayer in the capacity
of trustee;
(ii) the second company is not a partner in the
partnership;
(iii) an amount is included in the assessable income of
the second company of a year of income under subsection 92(1) or section 97 or 100;
(iv) the whole or a part of the amount so included in the
second company's assessable income (which whole or part is in this subsection called the 'assessable amount') is either:
(A) directly attributable to that dividend; or
(B) indirectly attributable to that dividend, through
one or more interposed trusts or partnerships;
sections 46 to 46F (inclusive) apply as if:
(d) the second company were a shareholder in the first company; and
(e) the dividend were paid by the first company to the second company instead of to the partnership; and
(f) the amount of the dividend were equal to the assessable amount; and
(g) if the second company has an interest in the share (whether that interest is held directly or indirectly through one or more interposed trusts or partnerships) - that interest were the share in respect of which the dividend was paid; and
(h) if the second company does not have an interest in the share (including an interest held directly or indirectly through one or more interposed trusts or partnerships):
(i) the second company had an interest in the share; and
(ii) that interest had been acquired by the second company
at the time when the share was acquired by the partnership; and
(iii) that interest were the share in respect of which the
dividend was paid; and
(i) a reference to the year of income in which the dividend was paid to the second company were a reference to the year of income to which the assessable amount relates; and
(j) a reference to a specified date or specified time before, on, at or after which the dividend was paid to the second company were a reference to the date or time before, on, at or after which the dividend was paid to the partnership; and
(k) the question of when the share was issued to the second company were answered by reference to the time when the share was issued to the partnership; and
(l) the question of when the share was issued to a person other than the second company were answered by reference to the time when the share was issued to the other person; and
(m) the question whether the payment of the dividend to the second company may reasonably be regarded as equivalent to the payment of interest on a loan were answered by reference to matters relating to the payment of the dividend to the partnership; and
(n) the question of the extent to which the dividend was paid by the first company to the second company out of particular profits were answered by reference to the dividend paid to the partnership; and
(o) the question of the extent to which the dividend paid to the second company was franked were answered by reference to the dividend paid to the partnership; and
(p) the question of when the dividend paid to the second company was declared were answered by reference to the dividend paid to the partnership.
(Modifications for corporate unit trusts and public trading trusts)
"(5) A reference in paragraphs (1)(a) and (b), (2)(a) and (c), (3)(b) and (4)(c) to a trustee does not include a reference to the trustee of:

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(a) a corporate unit trust within the meaning of Division 6B; or
(b) a public trading trust within the meaning of Division 6C.".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 11
Rebate on dividends

11. Section 46 of the Principal Act is amended by adding at the end the following subsections:
"(12) A shareholder in a capacity of trustee is not, and is taken never to have been, entitled to a rebate under this section.
"(13) Subsection (12) does not apply to the trustee of:
(a) a corporate unit trust within the meaning of Division 6B; or
(b) a public trading trust within the meaning of Division 6C.".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 12
Rebate on dividends paid as part of dividend stripping operation

12. Section 46A of the Principal Act is amended by adding at the end the following subsections:
"(19) A shareholder in a capacity of trustee is not, and is taken never to have been, entitled to a rebate under this section.
"(20) Subsection (19) does not apply to the trustee of:
(a) a corporate unit trust within the meaning of Division 6B; or
(b) a public trading trust within the meaning of Division 6C.".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 13
Composition of taxable income

13. Section 50N of the Principal Act is amended by adding at the end the following subsection:
"(24) Section 45Z applies for the purposes of subsection (23) of this section in a corresponding way to the way in which it applies for the purposes of sections 46 and 46A.".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 14
Losses and outgoings

14. Section 51 of the Principal Act is amended by inserting after subsection (2) the following subsection:
"(2A) If:
(a) a taxpayer incurs expenditure in a year of income in connection with the acquisition of stock that will become trading stock on hand of the taxpayer; and
(b) as at the end of the year of income, a part of the stock is not, and has not been, trading stock on hand of the taxpayer; and
(c) a deduction under subsection (1) in respect of the expenditure would, apart from this subsection, be allowable from the assessable income of the taxpayer of the year of income;
then, instead of the deduction under subsection (1) being allowable as mentioned in paragraph (c), a deduction under subsection (1) in relation to each part of the stock, equal to so much of the expenditure as is attributable to that part, is allowable from the assessable income of the taxpayer of:
(d) the year of income in which that part of the stock first becomes trading stock on hand of the taxpayer; or
(e) if an amount is included in the assessable income of the taxpayer of an earlier year of income in connection with the disposal of that part of the stock - that earlier year of income.".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 15
Depreciation

15. Section 54 of the Principal Act is amended by inserting after subsection (2) the following subsection:
"(2A) If the annual depreciation percentage fixed under section 55 for a unit of property owned by a taxpayer is 100%, depreciation is only allowable for the year of income in which the property is first used, or first installed and held in reserve, as mentioned in subsection (1).".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 16

16. Section 55 of the Principal Act is repealed and the following sections are substituted:
Effective life of property
(Definition of effective life)
"54A.(1) For the purposes of section 55, the effective life of a unit of property owned by a taxpayer is whichever of the following periods is applicable:
(a) if:
(i) there is in force a determination by the Commissioner
under subsection (2) which specifies a period that the taxpayer may elect to adopt as the effective life of the property; and
(ii) the taxpayer makes a written election to adopt that
period;
that period;
(b) if paragraph (a) does not apply - the period, worked out as at the time when the property is first used for assessable income-producing purposes by the taxpayer, during which it would be reasonable to conclude that the property would be held by the taxpayer assuming:
(i) if the property was not new at that time - that the
property was new at that time; and
(ii) that the taxpayer was to hold the property until it
was no longer reasonably capable of being used, by the taxpayer or by any
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other person, for:
(A) assessable income-producing purposes; or
(B) exempt income-producing purposes; and
(iii) if, at the time the property was first used for
assessable income-producing purposes by the taxpayer, it may reasonably be expected that the property will be subject to wear and tear by the taxpayer at a particular rate - that that rate were the rate of wear and tear to which the property will be subject; and
(iv) that the property were to be maintained in reasonably
good order and condition;
(c) if:
(i) paragraph (a) does not apply; and
(ii) the property was new at the time when the property
was first used by the taxpayer for assessable income-producing purposes; and
(iii) at the time of that first use, it would be
reasonable to conclude that the property is likely to be:
(A) scrapped; or
(B) sold for scrap; or
(C) abandoned;
by the taxpayer at a later time; and
(iv) the period beginning at the time of that first use
and ending at that later time is shorter than the period mentioned in paragraph (b);
that shorter period;
(d) if:
(i) paragraph (a) does not apply; and
(ii) the property was not new at the time when the
property was first used by the taxpayer for assessable income-producing purposes; and
(iii) assuming that the property was new at the time of
that first use, it would be reasonable to conclude at that time that the property would be likely to be:
(A) scrapped; or
(B) sold for scrap; or
(C) abandoned;
by the taxayer at a later time; and
(iv) the period beginning at the time of that first use
and ending at that later time is shorter than the period mentioned in paragraph (b);
that shorter period.
(Commissioner may determine etc. periods which taxpayers may elect to adopt as the effective lives of units of property)
"(2) The Commissioner may, by writing:
(a) make a determination specifying periods that taxpayers may elect to adopt as the effective lives of units of property owned by them; and
(b) revoke or vary such a determination.
(Period may be specified unconditionally)
"(3) A period may be specified unconditionally.
(Specification of period may be conditional)
"(4) A period, or 2 or more different periods, may be specified in relation to property of a particular kind subject to one or more specified conditions being satisfied as at the time when the property is first used by the taxpayer for assessable income-producing purposes.
(Conditions may relate to use)
"(5) The conditions may include, but are not limited to, conditions relating to:
(a) if the property is installed ready for use for the purpose of producing assessable income and held in reserve by the taxpayer - the particular use or uses for which the property has been installed and held in reserve; or
(b) in any other case - the particular use or uses of the property by the taxpayer.
(Criteria for specifying periods)
"(6) The matters to which the Commissioner may have regard in specifying periods include, but are not limited to, the periods that, apart from paragraph (1)(a), would be applicable under paragraph (1)(b) to property owned by particular groups of taxpayers who use similar property in a similar manner.
(Taxpayer may require the Commissioner to vary a determination so that it specifies a period in relation to property)
"(7) If, at the time when the property was first used by the taxpayer for assessable income-producing purposes:
(a) a determination is in force under subsection (2); and
(b) the determination does not specify a period that the taxpayer may elect to adopt as the effective life of the property;
the taxpayer may lodge with the Commissioner a written notice requiring the Commissioner to vary the determination in accordance with paragraph (2)(b) so that the determination specifies such a period.
(Time within which Commissioner must vary determination)
"(8) The Commissioner must comply with the requirement to vary a determination by whichever is the latest of the following times:
(a) the end of the period of 60 days (in this subsection called the
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`original 60-day period') after the notice requiring the Commissioner to vary the determination is lodged;
(b) if the Commissioner, by written notice served on the taxpayer within the original 60-day period, requests the taxpayer to give information relating to the variation sought by the taxpayer - the end of 60 days after the Commissioner receives that information;
(c) if the Commissioner, by written notice served under section 264 within the original 60-day period, requires a person other than the taxpayer to give information relating to the variation sought by the taxpayer - the end of 60 days after the Commissioner receives that information.
(Determination etc. to be available for sale to public)
"(9) A determination, or a variation or revocation of a determination, must be made available for sale to the public.
(When determination etc. may be retrospective)
"(10) A determination, or a variation or revocation of a determination, may be expressed to apply in relation to property first used by taxpayers for assessable income- producing purposes before the determination, variation or revocation, as the case may be, was made if, and only if:
(a) in the case of a determination or a variation of a determination - the specified period is the first period applicable to property of that kind; or
(b) in any case - the retrospectivity works to the advantage of taxpayers in calculating the effective lives of property of that kind.
(Election to adopt period specified in determination as effective life)
"(11) An election under paragraph (1)(a) is irrevocable and must be made:
(a) within 6 months after the later of the following:
(i) the end of the year of income in which the property is
first used by the taxpayer for assessable income-producing purposes;
(ii) the commencement of this section; or
(b) within such further period as the Commissioner allows.
(Commissioner to make first determination within 28 days)
"(12) The Commissioner must make a determination under subsection (2) within 28 days after the commencement of this section.
(Meaning of 'use for assessable income-producing purposes')
"(13) For the purposes of this section, a unit of property is taken to be used for assessable income-producing purposes by a taxpayer if, and only if, the property is:
(a) used by the taxpayer for the purpose of producing assessable income; or
(b) installed ready for use for that purpose and held in reserve by the taxpayer.
(Meaning of 'use for exempt income-producing purposes')
"(14) For the purposes of this section, a unit of property is taken to be used for exempt income-producing purposes by a person if, and only if, the property is:
(a) used by the person for the purpose of producing exempt income; or
(b) installed ready for use for that purpose and held in reserve by the person.
Annual depreciation percentage
"55.(1) The annual depreciation percentage for a unit of property owned by a taxpayer is worked out as follows.
"(2) (Step 1: raw percentage) Work out, to 2 decimal places, the percentage (in this section called the 'raw percentage') using the formula:
1
No. of years x 100
in effective life
where:
'No. of years in effective life' means:
(a) the number (calculated to 2 decimal places) of years in the effective life of the property; or
(b) 1;
whichever is the greater.
"(3) (Step 2: 100% depreciation) If:
(a) the cost of the property does not exceed $300 or such higher amount as is prescribed; or
(b) the raw percentage is more than 33;f8%;
the annual depreciation percentage is 100%.
"(3A) (Step 2A: scientific research) If:
(a) step 2 does not apply; and
(b) the property is used by the taxpayer for the purposes of scientific research only; and
(c) the property was acquired by the taxpayer before 1 July 1995;
the annual depreciation percentage is 33;f8%.
"(4) (Step 3: employee amenities) If neither step 2 nor 2A applies and the property is used by the taxpayer principally for the purpose of providing clothing cupboards, first aid, rest-room or recreational facilities, or meals or facilities for meals:
(a) for persons employed by the taxpayer in a business carried on by the taxpayer for the purpose of producing assessable income; or
(b) for the care of children of those persons;
the annual depreciation percentage is 33;f8%.

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"(5) (Step 4: broadbanding) If:
(a) none of steps 2, 2A and 3 apply; and
(b) the raw percentage is below one of the following:
23/4%, 5%, 73/4%, 10%, 15%, 20% or 33;f8%; and
(c) the property is none of the following:
(i) a painting, sculpture, drawing, engraving or
photograph;
(ii) a reproduction of any such thing;
(iii) property of a description, or of a use, similar to
anything covered by subparagraph (i) or (ii); and
(d) the taxpayer does not elect, in accordance with subsection (8), to waive broadbanding;
the raw percentage is re-calculated as the next highest of those percentages.
"(6) (Step 5: loading) If:
(a) none of steps 2, 2A and 3 apply; and
(b) the property is not an eligible motor vehicle; and
(c) a deduction has not been allowed, and is not allowable, to the taxpayer in relation to any year of income in respect of the property in accordance with section 57AK or 57AM;
the annual depreciation percentage is calculated using the formula:
Raw percentage x 1.2
"(7) (Step 6: no loading) If none of steps 2, 2A, 3 and 5 apply, the annual depreciation percentage is the raw percentage.
"(8) A taxpayer may elect to waive broadbanding for a unit of property in respect of which depreciation is allowable to the taxpayer for a particular year of income.
"(9) In this section:
'eligible motor vehicle' means a motor vehicle (including a vehicle known as a four wheel drive vehicle) that is:
(a) a motor car, station wagon, panel van, utility truck or similar vehicle; or
(b) a motor cycle or similar vehicle; or
(c) any other road vehicle designed to carry a load of less than one tonne or fewer than 9 passengers;
'scientific research' has the same meaning as in section 73A.".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 17
Calculation of depreciation

17. Section 56 of the Principal Act is amended:
(a) by omitting from paragraph (1)(a) "percentage fixed by or under section 55, or under the previous Act," and substituting "annual depreciation percentage fixed under section 55";
(b) by omitting from paragraph (1)(b) "percentage fixed, by or under section 55," and substituting "annual depreciation percentage fixed under section 55";
(c) by inserting in subsection (1A) "the annual depreciation percentage fixed under section 55 for a unit of property is less than 100% and" after "Where".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 18
Limit on cost price for depreciation of motor vehicle

18. Section 57AF of the Principal Act is amended by omitting from subsection (10) all the words preceding "before" and substituting "The Commissioner must publish by written notice".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 19
Repeal of section 57AG

19. Section 57AG of the Principal Act is repealed.

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 20
Special depreciation on property used for basic iron or steel production

20. Section 57AK of the Principal Act is amended by omitting from paragraph (5)(a) "the annual depreciation fixed under subsection 55(1), as increased by any amount that would, but for this section, be applicable under section 57AG," and substituting "the annual depreciation percentage fixed under section 55,".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 21

21. After section 57AM of the Principal Act the following section is inserted:
Depreciation roll-over relief for unpooled property where CGT roll-over relief allowed under section 160ZZM, 160ZZMA, 160ZZN, 160ZZNA or 160ZZO or where election for roll-over relief made under section 59AA
(Roll-over relief where CGT roll-over relief allowed)
"58.(1) This section applies to the disposal of a unit of property by a taxpayer (in this section called the 'transferor') to another taxpayer (in this section called the 'transferee') if:
(a) either:
(i) in a case where the transferor is not a partnership -
section 160ZZM, 160ZZMA, 160ZZN or 160ZZO applies to the disposal of the property by the transferor; or
(ii) if the transferor is a partnership - the property is
partnership property of the partnership and section 160ZZNA applies to the corresponding disposal, by all of the partners in the partnership, of their interests in the property; and

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(b) depreciation has been allowed, or is allowable, to the transferor in respect of the property.
(Roll-over relief where joint election made under section 59AA)
"(2) This section also applies if a joint election for roll-over relief is made under section 59AA by both the transferor and the transferee referred to in that section in relation to the disposal of a unit of property.
(No balancing charges or deductions)
"(3) Section 59 (which deals with balancing charges and deductions) does not apply to the disposal of the property by the transferor.
(Transferee to inherit certain characteristics from transferor)
"(4) The provisions of this Act relating to depreciation apply as if:
(a) if the depreciation allowable to the transferor in respect of the property for the year of income in which the disposal occurred was calculated in accordance with paragraph 56(1)(a):
(i) the transferee were not entitled to make an election
under subsection 56(1AA) in relation to the property; and
(ii) the transferee had acquired the unit of property for
a consideration equal to the depreciated value of the property immediately before the time of disposal (worked out on the assumption that subsection 60(2) had not been enacted); and
(b) if:
(i) the depreciation allowable to the transferor in
respect of the property for the year of income in which the disposal occurred was calculated in accordance with paragraph 56(1)(b); or
(ii) both:
(A) the depreciation allowable to the transferor in
respect of the property for the year of income in which the disposal occurred was calculated in accordance with section 57AK or 57AM; and
(B) neither section 57AK nor 57AM applied to the
transferee in respect of the property;
then:
(iii) the transferee had made an election under subsection
56(1AA) in relation to the property; and
(iv) the transferee had acquired the unit of property for
a consideration equal to the cost of the unit to the transferor; and
(v) depreciation were not allowable to the transferee in
respect of:
(A) so much of the cost of the property as was allowed
or allowable to the transferor in respect of depreciation in relation to the property (worked out as if section 61 had not been enacted); or
(B) if there have been 2 or more prior successive
applications of this section - so much of the cost of the property as was allowed or allowable to the prior successive transferors in respect of depreciation in relation to the property (worked out as if section 61 had not been enacted); and
(vi) the depreciated value of the property at a time when
the property was owned by the transferee were worked out as if the total of:
(A) the amounts allowed or allowable to the transferor
in respect of depreciation in relation to the property; and
(B) if there have been 2 or more prior successive
applications of this section - the amounts allowed or allowable to the prior successive transferors in respect of depreciation in relation to the property;
were taken to have been amounts allowed or allowable to the transferee in respect of depreciation in relation to the property; and
(c) the effective life of the property worked out under section 54A in relation to the transferor were the effective life of the property worked out under that section in relation to the transferee; and
(d) if step 2A in section 55 applied to the transferor in relation to the property in relation to the year of income in which the disposal occurred - that step has effect, in relation to the transferee in relation to the property, as if the transferee had acquired the property before 1 July 1995.
(Section 57AK - special rules)
"(5) If section 57AK (which deals with iron or steel production) applied to the transferor in relation to the property in relation to the year of income of the transferor in which the time of the disposal occurred, then:
(a) section 57AK has effect, in relation to the transferee and in relation to the property, as if:
(i) the conditions set out in paragraphs 57AK(1)(b) and
(c) that were satisfied in relation to the transferor were satisfied in relation to the transferee; and
(ii) subsection 57AK(8) had not been enacted; and
(b) if section 57AK applies to the transferee in relation to the property - the provisions of this Act relating to depreciation apply as if:
(i) the transferee had acquired the unit of property for a
consideration equal to the cost of the unit to the transferor; and
(ii) depreciation were not allowable to the transferee in
respect of:
(A) so much of the cost of the property as was allowed
or allowable to the transferor in respect of depreciation in relation to the
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property (worked out as if section 61 had not been enacted); or
(B) if there have been 2 or more prior successive
applications of this section - so much of the cost of the property as was allowed or allowable to the prior successive transferors in respect of depreciation in relation to the property (worked out as if section 61 had not been enacted); and
(iii) the depreciated value of the property at a time when
the property was owned by the transferee were worked out as if the total of:
(A) the amounts allowed or allowable to the transferor
in respect of depreciation in relation to the property; and
(B) if there have been 2 or more prior successive
applications of this section - the amounts allowed or allowable to the prior successive tranferors in respect of depreciation in relation to the property;
were taken to have been amounts allowed or allowable to the transferee in respect of depreciation in relation to the property.
(Pro-rating of depreciation)
"(6) Subsection 56(1A) (which deals with pro-rating) applies to the transferor and transferee in relation to the year of income in which the disposal occurred as if a reference to depreciation allowable in accordance with subsection 56(1) in respect of the property included a reference to depreciation allowable otherwise than in accordance with subsection 56(1).
(Disposal by transferee where no roll-over relief - inheritance of deductions)
"(7) If:
(a) after the disposal of the property to the transferee, the property is lost or destroyed or the transferee disposes of the property; and
(b) in the case of a disposal by the transferee - this section does not apply to the disposal;
then, for the purposes of the application of subsection 59(2) in relation to the loss, destruction or disposal, the total of:
(c) the amounts allowed or allowable to the transferor in respect of depreciation in relation to the property; and
(d) if there have been 2 or more prior successive applications of this section - the amounts allowed or allowable to the prior successive transferors in respect of depreciation in relation to the property;
are taken to have been amounts allowed or allowable to the transferee in respect of depreciation in relation to the property.
(CGT roll-over relief applies to motor vehicles)
"(8) For the purposes of this section, in addition to the effect that sections 160ZZM, 160ZZMA, 160ZZN, 160ZZNA and 160ZZO have apart from this subsection, those sections also have the effect that they would have if a reference in those sections to an asset included a reference to a motor vehicle of a kind mentioned in paragraph 82AF(2)(a).".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 22
Disposal, loss or destruction of depreciated property

22. Section 59 of the Principal Act is amended:
(a) by omitting from paragraph (4)(a) "the Commissioner is satisfied" and substituting "it would be concluded";
(b) by omitting from paragraph (4)(b) "and less than the depreciated value of the property immediately before the time of disposal";
(c) by omitting from subsection (4) "or the depreciated value of the property immediately before the time of disposal, whichever is the less";
(d) by omitting subsection (4A).

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 23
Disposal of depreciated property on change of ownership or interest

23. Section 59AA of the Principal Act is amended:
(a) by omitting from subsection (1) "Subject to this section, where" and substituting "If";
(b) by omitting from subsection (1) all the words after "property before the change" (second occurring) and substituting "(in this section called the 'transferor') had, on the day on which the change occurred, disposed of the whole of the property to the person, or all the persons, by whom the property is owned after the change (in this section called the 'transferee')";
(c) by omitting subsection (2) and substituting the following subsections:
"(2) Unless a joint election for roll-over relief is made by both the transferor and the transferee, the provisions of this Act relating to depreciation apply as if the consideration for the disposal were equal to the market value of the property immediately before the time when the change occurred.
"(2A) If a joint election for roll-over relief is made by both the transferor and the transferee, section 58 applies to the disposal.
"(2B) A joint election for roll-over relief has no effect unless it:
(a) is in writing; and
(b) is made:
(i) within 6 months after the later of the following:
(A) the end of the year of income of the transferee in
which the disposal occurred;
(B) the commencement of this subsection; or
(ii) within such further period as the Commissioner
allows; and
(c) contains such information about the transferor's holding of the
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property as will enable the transferee to work out how section 58 will apply to the transferee's holding of the property.
"(2C) If a person dies before the end of the period allowed for making a joint election for roll-over relief, the trustee of the deceased person's estate may be a party to the election on the deceased person's behalf.";
(d) by omitting from subsection (4) "This section" and substituting "Subsection (2)".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 24

24. After section 62AAA the following sections are inserted:
Object of pooling of depreciable property
"62AAB. The object of pooling is to provide taxpayers with a simplified method of quantifying the annual depreciation allowable in respect of 2 or more units of property which are depreciable at the same rate.
Taxpayer may create pools to which depreciable property may be allocated
"62AAC.(1) A taxpayer may, by written notice:
(a) create a pool to which depreciable property may be allocated; and
(b) specify a year of income as the earliest year of income for which property may be allocated to the pool; and
(c) specify a percentage as the pool percentage for the pool.
"(2) A notice under subsection (1) is irrevocable and must be made:
(a) within 6 months after the later of the following:
(i) the end of the specified year of income;
(ii) the commencement of this section; or
(b) within such further period as the Commissioner allows.
Pool percentage
"62AAD. For the purposes of this Act, the pool percentage for a pool is the pool percentage specified in the notice creating the pool.
Allocation of property to a pool
"62AAE.(1) A taxpayer may, by written notice, allocate a unit of property to a specified pool for a specified year of income and for subsequent years of income if:
(a) depreciation is allowable to the taxpayer under this Act in respect of the property in relation to the specified year of income; and
(b) at all times during the period:
(i) commencing at the time the taxpayer's ownership of the
property began; and
(ii) ending immediately after the beginning of the
specified year of income;
the property was:
(iii) used by the taxpayer exclusively for the purpose of
producing assessable income; or
(iv) installed ready for exclusive use for that purpose
and held in reserve by the taxpayer; and
(c) the annual depreciation percentage fixed under section 55 for the property in relation to the specified year of income equals the pool percentage for the pool; and
(d) the taxpayer has not allocated the property to any other pool for the specified year of income or a subsequent year of income; and
(e) each amount of depreciation allowed or allowable to the taxpayer in respect of the property in relation to a year of income earlier than the specified year of income was calculated in accordance with subsection 56(1) or section 62AAP; and
(f) apart from that allocation, the depreciation allowable to the taxpayer in respect of the property in relation to the specified year of income would have been calculated in accordance with subsection 56(1); and
(g) the specified year of income is not earlier than the earliest year of income for which property may be allocated to the pool.
"(2) A notice under subsection (1) is irrevocable and must be made:
(a) within 6 months after the later of the following:
(i) the end of the specified year of income;
(ii) the commencement of this section; or
(b) within such further period as the Commissioner allows.
Cancellation of allocation to pool - taxpayer's notice
"62AAF.(1) A taxpayer may, by written notice, cancel the allocation of specified property to a pool insofar as the allocation applies for a specified year of income and for subsequent years of income.
"(2) A notice under subsection (1) is irrevocable and must be made:
(a) within 6 months after the later of the following:
(i) the end of the specified year of income;
(ii) the commencement of this section; or
(b) within such further period as the Commissioner allows.
"(3) If, under this section, a taxpayer cancels the allocation of property to a pool for a year of income, this Act does not prevent the taxpayer from re-allocating the property to the pool for the year of income in accordance with section 62AAE.
Cancellation of allocation to pool - cessation of exclusive assessable income-producing use
"62AAG.(1) If:
(a) property is allocated by a taxpayer to a pool for a year of income; and
(b) during the year of income, the taxpayer ceased to use the property
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exclusively for assessable income-producing purposes; and
(c) that cessation was not by way of the disposal, loss or destruction of the property;
the allocation is cancelled insofar as it applies for that year of income and for subsequent years of income.
"(2) For the purposes of this section, a unit of property is taken to be used for assessable income-producing purposes by a taxpayer if, and only if, the property is:
(a) used by the taxpayer for the purpose of producing assessable income; or
(b) installed ready for use for that purpose and held in reserve by the taxpayer.
Cancellation of allocation to pool - annual depreciation percentage not equal to pool percentage
"62AAH. If:
(a) property is allocated by a taxpayer to a pool for a year of income; and
(b) the annual depreciation percentage fixed under section 55 for the property in relation to the year of income does not equal the pool percentage for the pool;
the allocation is cancelled insofar as it applies for that year of income and for subsequent years of income.
Cancellation of allocation to pool - subsequent application of special depreciation provisions
"62AAJ. If:
(a) property is allocated by a taxpayer to a pool for a year of income; and
(b) apart from that allocation, the depreciation allowable to the taxpayer in respect of the property in relation to the year of income would have been calculated otherwise than in accordance with subsection 56(1);
the allocation is cancelled insofar as it applies for that year of income and for subsequent years of income.
Cancellation of allocation to pool - disposal to which section 58 applies
"62AAK. If:
(a) property is allocated by a taxpayer to a pool for a year of income; and
(b) the property is disposed of during the year of income; and
(c) section 58 applies to that disposal;
the allocation is cancelled insofar as it applies for that year of income and for subsequent years of income.
Effect of cancellation of allocation to pool
"62AAL. If the allocation of property to a pool for a year of income is cancelled, the property is taken never to have been allocated to the pool for the year of income.
Reconstruction assumptions and reconstructed depreciated value
"62AAM.(1) If property is allocated by a taxpayer to a pool for a year of income, the reconstruction assumptions applicable to the property for the year of income are as follows:
(a) the assumption that the property had not been allocated to the pool for the year of income;
(b) the assumption that the depreciation allowable to the taxpayer in relation to the year of income in respect of the property had been calculated in accordance with paragraph 56(1)(a);
(c) the assumption that the percentage specified in that paragraph was equal to the pool percentage for the pool.
"(2) The reconstructed depreciated value of property allocated to a pool for a year of income is the amount that would have been the depreciated value of the property if the reconstruction assumptions had applied to the property for each year of income for which the property was allocated to the pool.
Opening balance of pool
"62AAN. The opening balance of a pool for a year of income (in this section called the 'current year of income') is calculated using the formula:
Closing balance for + Depreciated value - Reconstructed
preceding year of new property depreciated value
of cancelled property
where:
'Closing balance for preceding year' means the closing balance of the pool for the preceding year of income;
'Depreciated value of new property' means the amount obtained by:
(a) identifying each unit of property allocated to the pool for the current year of income where the current year of income is the first year of income for which the allocation applies; and
(b) calculating the depreciated value, as at the beginning of the current year of income, of each such unit of property; and
(c) adding up those depreciated values;
'Reconstructed depreciated value of cancelled property' means the amount obtained by:
(a) identifying each unit of property allocated to the pool for the preceding year of income where the allocation of the property to the pool for the current year of income is cancelled; and
(b) calculating the reconstructed depreciated value, as at the beginning of the current year of income, of each such unit of property; and
(c) adding up those reconstructed depreciated values.

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Closing balance of pool
"62AAO. The closing balance of a pool for a year of income is worked out using the formula:
Opening balance - Total depreciation
where:
'Opening balance' means the opening balance of the pool for the year of income;
'Total depreciation' means the total depreciation allowable to the taxpayer under this Act in relation to the year of income in respect of all the units of property allocated to the pool for the year of income.
Calculation of depreciation - pooled property
"62AAP.(1) The total depreciation allowable to a taxpayer under this Act in relation to a year of income in respect of all the units of property allocated to a pool for the year of income is worked out using the formula:
1.5 x Pool percentage x Opening balance
where:
'Pool percentage' means the pool percentage for the pool;
'Opening balance' means the opening balance of the pool for the year of income.
"(2) This section applies in spite of section 56.
Cancellation of allocation of property to a pool - effect on subsequent operation of depreciation provisions
"62AAQ. If the allocation of a unit of property to a pool is cancelled, the provisions of this Act relating to depreciation apply, in relation to each year of income to which the cancellation applies and any subsequent year of income, as if the reconstruction assumptions had applied for each year of income for which the property was allocated to the pool.
Cancellation of allocation of property to pool - taxpayer must use diminishing value method to calculate subsequent depreciation
"62AAR. If:
(a) the allocation of a unit of property to a pool for a year of income (in this section called the 'current year of income') is cancelled; and
(b) the property is allocated to the pool for the preceding year of income;
then, in calculating the depreciation (if any) allowable to the taxpayer in respect of the property in accordance with subsection 56(1) for the current year of income or a subsequent year of income, this Act has effect as if paragraph 56(1)(b) had not been enacted.
No balancing charges/deductions while property allocated to pool
"62AAS. If property is allocated to a pool for a year of income, subsections 59(1) and (2) do not apply to the disposal, loss or destruction of the property during the year of income.
Taxpayer's assessable income to include proceeds of disposal of pooled property etc.
"62AAT.(1) If:
(a) property is allocated by a taxpayer to a pool for a year of income; and
(b) the property is disposed of, lost or destroyed during the year of income;
then:
(c) an amount equal to so much of the consideration receivable in respect of the disposal, loss or destruction (within the meaning of section 59) as does not exceed the cost of the property is included in the taxpayer's assessable income of the year of income; and
(d) the disposal, loss or destruction does not affect the allocation of the property to the pool for a subsequent year of income; and
(e) so long as the property remains allocated to the pool for a subsequent year of income, section 62AAP applies to the subsequent year of income as if depreciation were allowable to the taxpayer under this Act in relation to the subsequent year of income in respect of the property.
"(2) Subsections 59(2A) to (2E) (inclusive) apply to the taxpayer and in relation to the property as if a reference in each of those subsections to subsection 59(2) included a reference to subsection (1) of this section.
"(3) If:
(a) property owned by a taxpayer is disposed of to another person; and
(b) an amount (in this subsection called the 'assessable amount'):
(i) is included in the taxpayer's assessable income under
subsection (1) of this section in respect of the disposal; or
(ii) would, apart from subsection 59(2A) or (2D), be
included in the taxpayer's assessable income under subsection (1) of this section in respect of the disposal; and
(c) section 60 applies to the acquisition of the property by the other person;
then:
(d) in spite of anything in subsection 60(1), the person acquiring the property is to be allowed depreciation calculated on the assessable amount; and
(e) in spite of anything in subsection 62(2), for the purposes of subsection 62(1), the person acquiring the property is taken to have acquired the property at a cost equal to the assessable amount.
Disposal of pooled property - application of CGT provisions
"62AAU. If:
(a) property is allocated by a taxpayer to a pool for a year of income (in this section called the 'current year of income'); and
(b) the property is disposed of (within the meaning of Part IIIA);

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section 160ZK applies to the disposal of the property as if the reconstruction assumptions had applied for each year of income for which the property was allocated to the pool.
Taxpayers may use their own form of words in pool notices
"62AAV. If:
(a) subsection 62AAC(1), 62AAE(1) or 62AAF(1) expresses an idea in a particular form of words; and
(b) a notice made by a taxpayer under the subsection concerned appears to have expressed the same idea in a different form of words for the purpose of convenience; the ideas are not taken to be different merely because different forms of words were used.".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 25
Deductions for debt dividends

25. Section 67AA of the Principal Act is amended by adding at the end the following subsection:
"(3) Section 45Z applies for the purposes of this section in a corresponding way to the way in which it applies for the purposes of sections 46, 46A and 46C.".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 26
Expenditure on scientific research

26.(1) Section 73A of the Principal Act is amended by inserting after subsection (4) the following subsection:
"(4A) If:
(a) a person has purchased from another person a building, or part of a building, where the vendor had incurred capital expenditure of a kind in respect of which deductions are or have been allowable under subsection (2); and
(b) it would be concluded that, having regard to any connection between the vendor and the purchaser or to any other relevant circumstances, those persons were not dealing with each other at arm's length; and
(c) the purchase price is greater or lesser than the market value of the building, or the part of the building, at the time of the purchase;
the purchase price is, for all purposes of the application of this Act in relation to the vendor, taken to have been the amount of the market value of the property at the time of the purchase.".
(2) Section 73A of the Principal Act is amended:
(a) by omitting subsection (5);
(b) by omitting from subsection (9) all the words after "30 June 1995".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 27

27. After section 73A of the Principal Act the following section is inserted:
Section 73A roll-over relief where CGT roll-over relief allowed under section 160ZZM, 160ZZMA, 160ZZN, 160ZZNA or 160ZZO
(Roll-over relief where CGT roll-over relief allowed)
"73AA.(1) This section applies to the disposal of a building, or part of a building, by a taxpayer (in this section called the 'transferor') to another taxpayer (in this section called the 'transferee') if:
(a) either:
(i) in a case where the transferor is not a partnership -
section 160ZZM, 160ZZMA, 160ZZN or 160ZZO applies to the disposal of the building or the part of the building by the transferor; or
(ii) if the transferor is a partnership - the building or
the part of the building is partnership property of the partnership and section 160ZZNA applies to the corresponding disposal, by all of the partners in the partnership, of their interests in the building or the part of the building; and
(b) deductions have been allowed or are allowable under subsection 73A(2) to the transferor in respect of the building or the part of the building.
(No balancing charges)
"(2) Subsection 73A(4) (which deals with balancing charges) does not apply to the disposal of the building or the part of the building by the transferor.
(Transferee to inherit certain characteristics from transferor)
"(3) Section 73A applies as if:
(a) the transferee had acquired the building or the part of the building for a consideration equal to the cost of the building or the part of the building to the transferor; and
(b) deductions were not allowable to the transferee under subsection 73A(2) in respect of:
(i) so much of the cost of the building or the part of the
building to the transferor as was allowed or allowable as a deduction to the transferor under that subsection in respect of the building or the part of the building; or
(ii) if there have been 2 or more prior successive
applications of this section - so much of the cost of the building or the part of the building to the transferor as was allowed or allowable as a deduction to the prior successive transferors under that subsection in respect of the building or the part of the building; and
(c) deductions were not allowable to the transferor under subsection 73A(2) in respect of the building or the part of the building for the year of income
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in which the disposal took place or for a subsequent year of income.
(Subsection 73A(2A) - special rules)
"(4) If subsection 73A(2A) applies to the transferor and in relation to the building or the part of the building, that subsection applies in relation to the transferee and in relation to the building or the part of the building.
(Disposal by transferee where no roll-over relief - inheritance of deductions)
"(5) If:
(a) after the disposal of the building or the part of the building to the transferee, the building or the part of the building is lost or destroyed or the transferee disposes of the building or the part of the building; and
(b) in the case of a disposal by the transferee - this section does not apply to the disposal;
then, for the purposes of the application of subsection 73A(4) in relation to the loss, destruction or disposal, the total of:
(c) the deductions allowed or allowable to the transferor under subsection 73A(2) in relation to the building or the part of the building; and
(d) if there have been 2 or more prior successive applications of this section - the deductions allowed or allowable to the prior successive transferors under subsection 73A(2) in relation to the building or the part of the building;
are taken to have been deductions allowed or allowable to the transferee under subsection 73A(2) in relation to the building or the part of the building.
(Meaning of 'cost')
"(6) A reference in this section to the cost of a building or of a part of a building to the transferor is a reference to expenditure of a capital nature incurred by the transferor in the construction or acquisition of the building or the part of the building, or in making any alteration or addition to the building or to the part of the building.".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 28
Expenditure on research and development activities

28. Section 73B of the Principal Act is amended:
(a) by inserting after subsection (15A) the following subsection:
"(15B) For the purposes of the application of paragraphs (15)(a), (23)(e) and (24)(e), if the eligible company commences to use the unit of plant exclusively for the purpose of the carrying on by or on behalf of it of research and development activities during the year of income ending on 30 June 1993 or an earlier year of income, the definition of 'deduction acceleration factor' in subsection (1) is to be read as if:
(a) the words '(a) in the case of the year of income ending on 30 June 1993 or an earlier year of income:' were omitted from the definition; and
(b) the word 'or' before paragraph (b) of the definition and that paragraph were omitted from the definition.";
(b) by inserting in paragraph (31)(a) "an amount of core technology expenditure," after "research and development expenditure,".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 29
Guaranteed returns to investors

29. Section 73CA of the Principal Act is amended by adding at the end of subsection (6) the following definition:
" 'expenditure' does not include core technology expenditure.".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 30
Losses to be allowable deductions

30. Section 82Z of the Principal Act is amended:
(a) by omitting from paragraph (3)(a) "primary" and substituting "loss";
(b) by omitting paragraph (3)(b) and substituting the following paragraphs:
"(b) the taxpayer or another person has made a currency exchange gain under another contract (in this subsection called the 'gain contract'); and
(ba) either:
(i) the loss contract would not have been entered into, or
might reasonably be expected not to have been entered into, if the gain contract had not been entered into; or
(ii) the gain contract would not have been entered into,
or might reasonably be expected not to have been entered into, if the loss contract had not been entered into;".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 31
Modified application of Act in relation to certain unit trusts

31.(1) Section 102L of the Principal Act is amended by omitting from subsection (2) "and 46E" and substituting ", 46E and 46F".
(2) Section 102L of the Principal Act is amended by inserting in subsection (2) "45Z," before "46" (first occurring).

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 32
Modified application of Act in relation to certain unit trusts

32.(1) Section 102T of the Principal Act is amended by omitting from subsection (2) "and 46E" and substituting ", 46E and 46F".
(2) Section 102T of the Principal Act is amended by inserting in subsection (2) "45Z," before "46" (first occurring).

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 33
Effect of Division on rebate under section 46 or 46A

33. Section 116J of the Principal Act is amended by adding at the end the following subsection:

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"(2) Section 45Z applies for the purposes of this section in a corresponding way to the way in which it applies for the purposes of sections 46 and 46A.".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 34

34. After section 122JA of the Principal Act the following section is inserted:
Roll-over relief where CGT roll-over relief allowed under section 160ZZM, 160ZZMA, 160ZZN, 160ZZNO or 160ZZO or where election for roll-over relief made under section 122R
(Roll-over relief where CGT roll-over relief allowed)
"122JAA.(1) This section applies to the disposal of property by a taxpayer (in this section called the 'transferor') to another taxpayer (in this section called the 'transferee') if:
(a) either:
(i) in a case where the transferor is not a partnership -
section 160ZZM, 160ZZMA, 160ZZN or 160ZZO applies to the disposal of the property by the transferor; or
(ii) if the transferor is a partnership - the property is
partnership property of the partnership and section 160ZZNA applies to the corresponding disposal, by all of the partners in the partnership, of their interests in the property; and
(b) deductions have been allowed or are allowable under this Subdivision to the transferor in respect of the property.
(Roll-over relief where joint election made under section 122R)
"(2) This section also applies if a joint election for roll-over relief is made under subsection 122R(2) by both the transferor and the transferee referred to in that subsection in relation to the disposal of property.
(No balancing charges or deductions)
"(3) Section 122K (which deals with balancing charges and deductions) does not apply to the disposal of the property by the transferor.
(Transferee to inherit certain characteristics from transferor)
"(4) This Subdivision and Subdivision C (to the extent to which it relates to this Subdivision) apply as if:
(a) if any part of the expenditure of the transferor in respect of the property is allowable capital expenditure of the transferor - the transferee had acquired the property for a consideration equal to the amount worked out using the formula:
Transferor's - Transferor's deductions + Undeducted excess
expenditure amounts
where:
'Transferor's expenditure' means so much of the total expenditure of a capital nature of the transferor in respect of the property as is allowable capital expenditure of the transferor;
'Transferor's deductions' means the sum of the deductions allowed or allowable to the transferor under this Subdivision in respect of so much of the expenditure of a capital nature of the transferor in respect of the property as is allowable capital expenditure of the transferor;
'Undeducted excess amounts' means the sum of the excess amounts referred to in subsection (5) in respect of the property; and
(b) if no part of the expenditure of the transferor in respect of the property is allowable capital expenditure of the transferor - the transferee had acquired the property for nil consideration; and
(c) if the property is a mining or prospecting right or mining or prospecting information:
(i) a notice under section 122B in respect of the
acquisition of the property had been given to the Commissioner by the transferor and the transferee; and
(ii) the amount specified in the notice were the amount
worked out under paragraph (a) of this subsection; and
(iii) subsections 122B(2), 122DG(9) and 122J(5) were not
applicable to that notice; and
(d) if the property is not a mining or prospecting right or mining or prospecting information - subsection 122DG(8) were not applicable to the disposal of the property; and
(e) the reference in paragraph 122DG(3)(a) to a year of income in respect of which a deduction has been allowed or is allowable, or, apart from the operation of subsection 122DG(6), would have been allowed or would be allowable, in respect of an amount of allowable capital expenditure of the transferee in respect of the property included a reference to a year of income in respect of which a deduction has been allowed or is allowable, or, apart from the operation of subsection 122DG(6), would have been allowed or would be allowable, in respect of allowable capital expenditure of:
(i) the transferor in respect of the property; or
(ii) if there have been 2 or more prior successive
applications of this section - any of the prior successive transferors in respect of the property.
(Transfer of subsection 122DG(7) excess amounts)
"(5) If, apart from this subsection, the following conditions are satisfied in relation to a deduction allowable to the transferor under subsection 122DG(2) in respect of the property:
(a) the deduction is allowable because of the application of subsection
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122DG(7);
(b) the deduction is in respect of an amount (in this subsection called the 'excess amount') of expenditure of a capital nature in respect of the property;
(c) the deduction is allowable for the year of income in which the disposal took place;
then:
(d) the excess amount is taken, under subsection 122DG(7), to be a deduction that is allowable under subsection 122DG(2) to the transferee for the year of income in which the disposal took place; and
(e) a deduction is not allowable to the transferor under subsection 122DG(2) in respect of the excess amount.
(Transfer of subsection 122J(3) excess amounts)
"(6) If, apart from this subsection, the following conditions would have been satisfied in relation to an amount (in this subsection called the 'excess amount') of contingent allowable capital expenditure of the transferor in respect of the property:
(a) the expenditure is taken to be contingent allowable capital expenditure because of subsection 122J(3);
(b) the contingency is that the transferor carried on prescribed mining operations in the year of income in which the disposal took place or a subsequent year of income;
then:
(c) the excess amount is taken, under subsection 122J(3), to be allowable capital expenditure incurred by the transferee in:
(i) if the transferee carried on prescribed mining
operations in the year of income in which the disposal took place - that year of income; or
(ii) the first subsequent year of income in which the
transferee carried on prescribed mining operations; and
(d) subsection 122J(3) does not apply in relation to the excess amount in relation to the transferor.
(Transfer of subsection 122J(4) excess amounts)
"(7) If, apart from this subsection, the following conditions would have been satisfied in relation to a contingent deduction allowable to the transferor under subsection 122J(1) in respect of the property:
(a) the deduction is allowable because of the application of subsection 122J(4);
(b) the deduction is in respect of an amount (in this subsection called the 'excess amount') of expenditure in respect of the property;
(c) the contingency is that the transferor had carried on prescribed mining operations in the year of income in which the disposal took place or a subsequent year of income;
then:
(d) the excess amount is taken, under subsection 122J(4), to be a deduction that is allowable under subsection 122J(1) to the transferee for:
(i) if the transferee carried on prescribed mining
operations in the year of income in which the disposal took place - that year of income; or
(ii) the first subsequent year of income in which the
transferee carried on prescribed mining operations; and
(e) a deduction is not allowable to the transferor under subsection 122J(1) in respect of the excess amount.
(Transfer of subsection 122J(4C) excess amounts)
"(8) If, apart from this subsection, the following conditions would have been satisfied in relation to a contingent deduction allowable to the transferor under subsection 122J(1) in respect of the property:
(a) the deduction is allowable because of the application of subsection 122J(4C);
(b) the deduction is in respect of an amount (in this subsection called the 'excess amount') of expenditure of a capital nature in respect of the property;
(c) the contingency is that the transferor had derived assessable income in the year of income in which the disposal took place or a subsequent year of income;
then:
(d) the excess amount is taken, under subsection 122J(4C), to be a deduction that is allowable under subsection 122J(1) to the transferee for:
(i) if the transferee derives assessable income in the
year of income in which the disposal took place - that year of income; or
(ii) the first subsequent year of income in which the
transferee derives assessable income; and
(e) a deduction is not allowable to the transferor under subsection 122J(1) in respect of the excess amount.
(Section 122C, 122DA, 122DC and 122DE and subsection 122DG(1) - inheritance of threshold conditions)
"(9) If section 122C, 122DA, 122DC or 122DE or subsection 122DG(1) applied to the expenditure of a capital nature of the transferor in respect of the property, that section or subsection has effect, in relation to the transferee and in relation to the property, as if the threshold conditions that were
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satisfied in relation to the transferor were satisfied in relation to the transferee.
(Subsection (9) - threshold conditions)
"(10) For the purposes of subsection (9), the following are taken to be threshold conditions in relation to expenditure in respect of property:
(a) a condition that the expenditure was incurred before, at or after a particular time;
(b) if the expenditure was incurred under a contract - a condition that the contract was, or was not, entered into before, at or after a particular time;
(c) if the expenditure was incurred in respect of the construction of property - a condition that the construction commenced, or did not commence, before, at or after a particular time.
(Subsections 122J(3) and (4) - inheritance of threshold conditions)
"(11) If subsection 122J(3) or (4) applied to the expenditure of the transferor in respect of the property, that subsection has effect, in relation to the transferee and in relation to the property, as if the threshold conditions that were satisfied in relation to the transferor were satisfied in relation to the transferee.
(Subsection (11) - threshold conditions)
"(12) For the purposes of subsection (11), the following are taken to be threshold conditions in relation to expenditure in respect of the property:
(a) a condition that the expenditure was incurred before, at or after a particular time;
(b) a condition that the expenditure was incurred during a particular year of income.
(Inheritance of section 122H election)
"(13) If the transferor made an election under section 122H in respect of expenditure on the property, the transferee is taken to have made an election under section 122H in respect of expenditure on the property.
(Rule where no section 122H election made)
"(14) If the transferor did not make an election under section 122H in respect of expenditure on the property, the transferee is not entitled to make an election under section 122H in respect of expenditure on the property.
(Inheritance of subsection 122A(1B) threshold conditions)
"(15) If:
(a) the property is plant or articles for the purposes of section 54; and
(b) the expenditure of a capital nature of the transferor in respect of the property is allowable capital expenditure; then, section 122A has effect in relation to the transferee and in relation to the property, as if the conditions set out in subsection 122A(1B) that were satisfied in relation to the transferor were satisfied in relation to the transferee.
(Leases - subsection 88B(5) election to have no effect)
"(16) If the property is a lease, being a mining or prospecting right, an election under subsection 88B(5) (whether made before or after the disposal) has no effect in relation to the grant, assignment or surrender of the lease.
(Provisions of Subdivision B of Division 16H - inheritance of threshold conditions)
"(17) If a provision of Subdivision B of Division 16H applied to the expenditure of the transferor in respect of the property, that provision has effect, in relation to the transferee and in relation to the property, as if the threshold conditions that were satisfied in relation to the transferor were satisfied in relation to the transferee.
(Subsection (17) - threshold conditions)
"(18) For the purposes of subsection (17), the following are taken to be threshold conditions in relation to expenditure in respect of the property:
(a) a condition that the expenditure was incurred before, at or after a particular time;
(b) a condition that the expenditure was incurred during a particular year of income.
(Recoupment of expenditure - consequential amendment of assessments)
"(19) Section 170 does not prevent the amendment at any time of an assessment of the transferee where section 122T has applied to:
(a) the transferor in respect of the property; or
(b) if there have been 2 or more prior successive applications of this section - any of the prior successive transferors in respect of the property.
(Disposal by transferee where no roll-over relief - inheritance of deductions)
"(20) If:
(a) after the disposal of the property to the transferee:
(i) the property is lost or destroyed; or
(ii) the transferee disposes of the property; or
(iii) the use of the property by the transferee for
prescribed purposes or eligible purposes (within the meaning of section 122K) is otherwise terminated; and
(b) in the case of a disposal by the transferee - this section does not apply to the disposal;
then, for the purposes of the application of section 122K in relation to the loss, destruction, disposal or termination, the total of:
(c) the deductions allowed or allowable to the transferor under this Subdivision in relation to the property; and
(d) if there have been 2 or more prior successive applications of this
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section - the deductions allowed or allowable to the prior successive transferors under this Subdivision in relation to the property;
are taken to have been deductions allowed or allowable to the transferee under this Subdivision in relation to the property.
(Disposal by transferee where no roll-over relief - inheritance of total expenditure of a capital nature)
"(21) In spite of subsection (4), if:
(a) after the disposal of the property to the transferee:
(i) the property is lost or destroyed; or
(ii) the transferee disposes of the property; or
(iii) the use of the property by the transferee for
prescribed purposes or eligible purposes (within the meaning of section 122K) is otherwise terminated; and
(b) in the case of a disposal by the transferee - this section does not apply to the disposal;
then, for the purposes of the application of section 122K in relation to the loss, destruction, disposal or termination, the total expenditure of a capital nature of the transferee in respect of the property is to be worked out as if the rule set out in subsection (22) had been applicable to:
(c) the disposal of the property by the transferor to the transferee; and
(d) if there have been 2 or more prior successive applications of this section - each prior successive disposal.
(Rule referred to in subsection (21))
"(22) The rule referred to in subsection (21) is that the transferee had acquired the property for a consideration equal to the total expenditure of a capital nature of the transferor in respect of the property.
(CGT roll-over relief applies to motor vehicles)
"(23) For the purposes of this section, in addition to the effect that sections 160ZZM, 160ZZMA, 160ZZN, 160ZZNA and 160ZZO have apart from this subsection, those sections also have the effect that they would have if a reference in those sections to an asset included a reference to a motor vehicle of a kind mentioned in paragraph 82AF(2)(a).".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 35

35. After section 122JF of the Principal Act the following section is inserted:
Roll-over relief where CGT roll-over relief allowed under section 160ZZM, 160ZZMA, 160ZZN, 160ZZNA or 160ZZO or where election for roll-over relief made under section 122R
(Roll-over relief where CGT roll-over relief allowed)
"122JG.(1) This section applies to the disposal of property by a taxpayer (in this section called the 'transferor') to another taxpayer (in this section called the 'transferee') if:
(a) either:
(i) in a case where the transferor is not a partnership -
section 160ZZM, 160ZZMA, 160ZZN or 160ZZO applies to the disposal of the property by the transferor; or
(ii) if the transferor is a partnership - the property is
partnership property of the partnership and section 160ZZNA applies to the corresponding disposal, by all of the partners in the partnership, of their interests in the property; and
(b) deductions have been allowed or are allowable under this Subdivision to the transferor in respect of the property.
(Roll-over relief where joint election made under section 122R)
"(2) This section also applies if a joint election for roll-over relief is made under subsection 122R(2A) by both the transferor and the transferee referred to in that subsection in relation to the disposal of property.
(No balancing charges or deductions)
"(3) Section 122K (which deals with balancing charges and deductions) does not apply to the disposal of the property by the transferor.
(Transferee to inherit certain characteristics from transferor)
"(4) This Subdivision and Subdivision C (to the extent to which it relates to this Subdivision) apply as if:
(a) if any part of the expenditure of the transferor in respect of the property is allowable capital expenditure of the transferor - the transferee had acquired the property for a consideration equal to the amount worked out using the formula:
Transferor's - Transferor's deductions + Undeducted excess
expenditure amounts
where:
'Transferor's expenditure' means so much of the total expenditure of a capital nature of the transferor in respect of the property as is allowable capital expenditure of the transferor;
'Transferor's deductions' means the sum of the deductions allowed or allowable to the transferor under this Subdivision in respect of so much of the expenditure of a capital nature of the transferor in respect of the property as is allowable capital expenditure of the transferor;
'Undeducted excess amounts' means the sum of the excess amounts referred to in subsection (5) in respect of the property; and
(b) if no part of the expenditure of the transferor in respect of the property is allowable capital expenditure of the transferor - the transferee
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had acquired the property for nil consideration; and
(c) if the property is a quarrying or prospecting right or quarrying or prospecting information:
(i) a notice under section 122JD in respect of the
acquisition of the property had been given to the Commissioner by the transferor and the transferee; and
(ii) the amount specified in the notice were the amount
worked out under paragraph (a) of this subsection; and
(iii) subsections 122JD(2), 122JE(11) and 122JF(9) were
not applicable to that notice; and
(d) if the property is not a quarrying or prospecting right or quarrying or prospecting information - subsection 122JE(10) were not applicable to the disposal of the property; and
(e) the reference in subparagraph 122JE(2)(a)(ii) to a year of income in respect of which a deduction has been allowed or is allowable, or, apart from the operation of subsection 122JE(5), would have been allowed or would be allowable, in respect of an amount of allowable capital expenditure of the transferee in respect of the property included a reference to a year of income in respect of which a deduction has been allowed or is allowable, or, apart from the operation of subsection 122JE(5), would have been allowed or would be allowable, in respect of allowable capital expenditure of:
(i) the transferor in respect of the property; or
(ii) if there have been 2 or more prior successive
applications of this section - any of the prior successive transferors in respect of the property.
(Transfer of subsection 122JE(9) excess amounts)
"(5) If, apart from this subsection, the following conditions are satisfied in relation to a deduction allowable to the transferor under subsection 122JE(1) in respect of the property:
(a) the deduction is allowable because of the application of subsection 122JE(9);
(b) the deduction is in respect of an amount (in this subsection called the 'excess amount') of expenditure of a capital nature in respect of the property;
(c) the deduction is allowable for the year of income in which the disposal took place;
then:
(d) the excess amount is taken, under subsection 122JE(9), to be a deduction that is allowable under subsection 122JE(1) to the transferee for the year of income in which the disposal took place; and
(e) a deduction is not allowable to the transferor under subsection 122JE(1) in respect of the excess amount.
(Transfer of subsection 122JF(6) excess amounts)
"(6) If, apart from this subsection, the following conditions would have been satisfied in relation to a contingent deduction allowable to the transferor under subsection 122JF(1) in respect of the property:
(a) the deduction is allowable because of the application of subsection 122JF(6);
(b) the deduction is in respect of an amount (in this subsection called the 'excess amount') of expenditure of a capital nature in respect of the property;
(c) the contingency is that the transferor had derived assessable income in the year of income in which the disposal took place or a subsequent year of income;
then:
(d) the excess amount is taken, under subsection 122JF(6), to be a deduction that is allowable under subsection 122JF(1) to the transferee for:
(i) if the transferee derives assessable income in the
year of income in which the disposal took place - that year of income; or
(ii) the first subsequent year of income in which the
transferee derives assessable income; and
(e) a deduction is not allowable to the transferor under subsection 122JF(1) in respect of the excess amount.
(Inheritance of section 122JF election)
"(7) If the transferor made an election under subsection 122JF(10) in respect of expenditure on the property, the transferee is taken to have made an election under subsection 122JF(10) in respect of expenditure on the property.
(Rule where no section 122JF election made)
"(8) If the transferor did not make an election under subsection 122JF(10) in respect of expenditure on the property, the transferee is not entitled to make an election under subsection 122JF(10) in respect of expenditure on the property.
(Recoupment of expenditure - consequential amendment of assessments)
"(9) Section 170 does not prevent the amendment at any time of an assessment of the transferee where section 122T has applied to:
(a) the transferor in respect of the property; or
(b) if there have been 2 or more prior successive applications of this section - any of the prior successive transferors in respect of the property.
(Disposal by transferee where no roll-over relief - inheritance of deductions)
"(10) If:

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(a) after the disposal of the property to the transferee:
(i) the property is lost or destroyed; or
(ii) the transferee disposes of the property; or
(iii) the use of the property by the transferee for
prescribed purposes or eligible purposes (within the meaning of section 122K) is otherwise terminated; and
(b) in the case of a disposal by the transferee - this section does not apply to the disposal;
then, for the purposes of the application of section 122K in relation to the loss, destruction, disposal or termination, the total of:
(c) the deductions allowed or allowable to the transferor under this Subdivision in relation to the property; and
(d) if there have been 2 or more prior successive applications of this section - the deductions allowed or allowable to the prior successive transferors under this Subdivision in relation to the property;
are taken to have been deductions allowed or allowable to the transferee under this Subdivision in relation to the property.
(Disposal by transferee where no roll-over relief - inheritance of total expenditure of a capital nature)
"(11) In spite of subsection (4), if:
(a) after the disposal of the property to the transferee:
(i) the property is lost or destroyed; or
(ii) the transferee disposes of the property; or
(iii) the use of the property by the transferee for
prescribed purposes or eligible purposes (within the meaning of section 122K) is otherwise terminated; and
(b) in the case of a disposal by the transferee - this section does not apply to the disposal;
then, for the purposes of the application of section 122K in relation to the loss, destruction, disposal or termination, the total expenditure of a capital nature of the transferee in respect of the property is to be worked out as if the rule set out in subsection (12) had been applicable to:
(c) the disposal of the property by the transferor to the transferee; and
(d) if there have been 2 or more prior successive applications of this section - each prior successive disposal.
(Rule referred to in subsection (11))
"(12) The rule referred to in subsection (11) is that the transferee had acquired the property for a consideration equal to the total expenditure of a capital nature of the transferor in respect of the property.
(CGT roll-over relief applies to motor vehicles)
"(13) For the purposes of this section, in addition to the effect that sections 160ZZM, 160ZZMA, 160ZZN, 160ZZNA and 160ZZO have apart from this subsection, these sections also have the effect that they would have if a reference in those sections to an asset included a reference to a motor vehicle of a kind mentioned in paragraph 82AF(2)(a).".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 36
Change in interests in property

36. Section 122R of the Principal Act is amended:
(a) by omitting from subsection (1) "Subject to this section, where'' and substituting "If";
(b) by omitting from subsection (1) all the words after "property before the change'' (second occurring) and substituting "in this section called the 'transferor') had, on the day on which the change occurred, disposed of the whole of the property to the person, or all the persons, by whom the property is owned after the change (in this section called the 'transferee')";
(c) by omitting subsection (2) and substituting the following subsections:
"(2) If deductions have been allowed or are allowable under Subdivision A in respect of the property:
(a) unless a joint election for roll-over relief is made by both the transferor and the transferee - this Division applies as if the consideration for the disposal were equal to the market value of the property immediately before the time when the change occurred; or
(b) if a joint election for roll-over relief is made by both the transferor and the transferee - section 122JAA applies to the disposal.
"(2A) If deductions have been allowed or are allowable under Subdivision B in respect of the property:
(a) unless a joint election for roll-over relief is made by both the transferor and the transferee - this Division applies as if the consideration for the disposal were equal to the market value of the property immediately before the time when the change occurred; or
(b) if a joint election for roll-over relief is made by both the transferor and the transferee - section 122JG applies to the disposal.
"(2B) A joint election for roll-over relief has no effect unless it:
(a) is in writing; and
(b) is made:
(i) within 6 months after the later of the following:
(A) the end of the year of income of the transferee in
which the disposal occurred;
(B) the commencement of this subsection; or
(ii) within such further period as the Commissioner

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allows; and
(c) contains such information about the transferor's holding of the property as will enable the transferee to work out how section 122JAA or 122JG, as the case may be, will apply to the transferee's holding of the property.
"(2C) If a person dies before the end of the period allowed for making a joint election for roll-over relief, the trustee of the deceased person's estate may be a party to the election on the deceased person's behalf.";
(d) by inserting in subsection (3) "or (2A)" after "subsection (2)".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 37

37. After section 123BB of the Principal Act the following section is inserted:
Roll-over relief where CGT roll-over relief allowed under section 160ZZM, 160ZZMA, 160ZZN, 160ZZNA or 160ZZO or where election for roll-over relief made under section 123F
(Roll-over relief where CGT roll-over relief allowed)
"123BBA.(1) This section applies to the disposal of property by a taxpayer (in this section called the 'transferor') to another taxpayer (in this section called the 'transferee') if:
(a) either:
(i) in a case where the transferor is not a partnership -
section 160ZZM, 160ZZMA, 160ZZN or 160ZZO applies to the disposal of the property by the transferor; or
(ii) if the transferor is a partnership - the property is
partnership property of the partnership and section 160ZZNA applies to the corresponding disposal, by all of the partners in the partnership, of their interests in the property; and
(b) deductions have been allowed or are allowable under this Subdivision to the transferor in respect of the property.
(Roll-over relief where joint election made under section 123F)
"(2) This section also applies if a joint election for roll-over relief is made under subsection 123F(2) by both the transferor and the transferee referred to in that subsection in relation to the disposal of property.
(No balancing charges or deductions)
"(3) Section 123C (which deals with balancing charges and deductions) does not apply to the disposal of the property by the transferor.
(Transferee to inherit certain characteristics from transferor)
"(4) This Subdivision and Subdivision C (to the extent to which it relates to this Subdivision) apply as if:
(a) the transferee had acquired the property for a consideration equal to so much of the capital expenditure of the transferor in respect of the property as is expenditure to which this Subdivision applies; and
(b) deductions were not allowable to the transferee under this Subdivision in respect of:
(i) so much of the capital expenditure of the transferor
in respect of the property as was allowed or allowable as a deduction to the transferor under this Subdivision; or
(ii) if there have been 2 or more prior successive
applications of this section - so much of the capital expenditure in respect of the property as was allowed or allowable as a deduction to the prior successive transferors under this Subdivision; and
(c) the 10-year period referred to in paragraph 123B(1)(a) or the 20-year period referred to in paragraph 123B(1)(b), as the case may be, over which the transferee would otherwise be allowed deductions in respect of the property were reduced by one year for each year of income for which a deduction was allowed or was allowable under this Subdivision to:
(i) the transferor in respect of the property; or
(ii) if there have been 2 or more prior successive
applications of this section - any of the prior successive transferors in respect of the property.
(Inheritance of section 123BA election)
"(5) If the transferor made an election under section 123BA in respect of capital expenditure incurred by the transferor in respect of the property, this Subdivision applies as if the transferee had made an election under that section in respect of the capital expenditure of the transferee.
(Rule where no section 123BA election made)
"(6) If the transferor did not make an election under section 123BA in respect of capital expenditure incurred by the transferor in respect of the property, the transferee is not entitled to make an election under that section in respect of the capital expenditure of the transferee.
(Inheritance of section 123BB election)
"(7) If the transferor made an election under section 123BB in respect of capital expenditure incurred by the transferor in respect of the property, this Subdivision applies as if the transferee had made an election under that section in respect of the capital expenditure of the transferee.
(Rule where no section 123BB election made)
"(8) If the transferor did not make an election under section 123BB in respect of capital expenditure incurred by the transferor in respect of the property, the transferee is not entitled to make an election under that section in respect of the capital expenditure of the transferee.

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(Subparagraphs 123B(1)(a)(i) and (ii) and paragraph 123B(1)(b) - inheritance of threshold conditions)
"(9) If subparagraph 123B(1)(a)(i) or (ii) or paragraph 123B(1)(b) applied to the expenditure of a capital nature of the transferor in respect of the property, that paragraph or subparagraph has effect, in relation to the transferee and in relation to the property, as if the threshold conditions that were satisfied in relation to the transferor were satisfied in relation to the transferee.
(Subsection (9) - threshold conditions)
"(10) For the purposes of subsection (9), the following are taken to be threshold conditions in relation to expenditure in respect of property:
(a) a condition that the expenditure was incurred before, at or after a particular time;
(b) if the expenditure was incurred under a contract - a condition that the property was acquired under a contract that was entered into before, at or after a particular time.
(Deduction where section 123BA election made by transferee)
"(11) If:
(a) the transferee incurs capital expenditure referred to in subparagraph 123B(1)(a)(i) or (ii) in respect of the property; and
(b) the transferee elects that section 123BA applies in respect of the capital expenditure of the transferee; and
(c) apart from the disposal, a deduction (in this subsection called the 'notional deduction') would have been allowable to the transferor under paragraph 123BA(3)(a) in respect of a particular year of income, being the year of income in which the disposal took place or a subsequent year of income;
the amount of the notional deduction is taken to be a deduction allowable under that paragraph to the transferee for the year of income concerned.
(Recoupment of expenditure - consequential amendment of assessments)
"(12) Section 170 does not prevent the amendment at any time of an assessment of the transferee where subsection 123A(2) has applied to:
(a) the transferor in respect of the property; or
(b) if there have been 2 or more prior successive applications of this section - one or more of the prior successive transferors in respect of the property.
(Disposal by transferee where no roll-over relief - inheritance of deductions)
"(13) If:
(a) after the disposal of the property to the transferee:
(i) the property is lost or destroyed; or
(ii) the transferee disposes of the property; or
(iii) the use of the property by the transferee primarily
and principally for a purpose referred to in section 123A is otherwise terminated; and
(b) in the case of a disposal by the transferee - this section does not apply to the disposal;
then, for the purposes of the application of section 123C in relation to the loss, destruction, disposal or termination, the total of:
(c) the deductions allowed or allowable to the transferor under this Subdivision in relation to the property; and
(d) if there have been 2 or more prior successive applications of this section - the deductions allowed or allowable to the prior successive transferors under this Subdivision in relation to the property;
are taken to have been deductions allowed or allowable to the transferee under this Subdivision in relation to the property.
(Disposal by transferee where no roll-over relief - inheritance of total expenditure of a capital nature)
"(14) In spite of subsection (4), if:
(a) after the disposal of the property to the transferee:
(i) the property is lost or destroyed; or
(ii) the transferee disposes of the property; or
(iii) the use of the property by the transferee primarily
and principally for a purpose referred to in section 123A is otherwise terminated; and
(b) in the case of a disposal by the transferee - this section does not apply to the disposal;
then, for the purposes of the application of section 123C in relation to the loss, destruction, disposal or termination, the total expenditure of a capital nature of the transferee in respect of the property is to be worked out as if the rule set out in subsection (15) had been applicable to:
(c) the disposal of the property by the transferor to the transferee; and
(d) if there have been 2 or more prior successive applications of this section - each prior successive disposal.
(Rule referred to in subsection (14))
"(15) The rule referred to in subsection (14) is that the transferee had acquired the property for a consideration equal to the total expenditure of a capital nature of the transferor in respect of the property.".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 38

38. After section 123BE of the Principal Act the following section is inserted:

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Roll-over relief where CGT roll-over relief allowed under section 160ZZM, 160ZZMA, 160ZZN, 160ZZNA or 160ZZO or where election for roll-over relief made under section 123F
(Roll-over relief where CGT roll-over relief allowed)
"123BF.(1) This section applies to the disposal of property by a taxpayer (in this section called the 'transferor') to another taxpayer (in this section called the 'transferee') if:
(a) either:
(i) in a case where the transferor is not a partnership -
section 160ZZM, 160ZZMA, 160ZZN or 160ZZO applies to the disposal of the property by the transferor; or
(ii) if the transferor is a partnership - the property is
partnership property of the partnership and section 160ZZNA applies to the corresponding disposal, by all of the partners in the partnership, of their interests in the property; and
(b) deductions have been allowed or are allowable under this Subdivision to the transferor in respect of the property.
(Roll-over relief where joint election made under section 123F)
"(2) This section also applies if a joint election for roll-over relief is made under subsection 123F(2) by both the transferor and the transferee referred to in that subsection in relation to the disposal of property.
(No balancing charges or deductions)
"(3) Section 123C (which deals with balancing charges and deductions) does not apply to the disposal of the property by the transferor.
(Transferee to inherit certain characteristics from transferor)
"(4) This Subdivision and Subdivision C (to the extent to which it relates to this Subdivision) apply as if:
(a) the transferee had acquired the property for a consideration equal to so much of the capital expenditure of the transferor in respect of the property as is expenditure to which this Subdivision applies; and
(b) deductions were not allowable to the transferee under this Subdivision in respect of:
(i) so much of the capital expenditure of the transferor
in respect of the property as was allowed or allowable as a deduction to the transferor under this Subdivision; or
(ii) if there have been 2 or more prior successive
applications of this section - so much of the capital expenditure in respect of the property as was allowed or allowable as a deduction to the prior successive transferors under this Subdivision; and
(c) the 20-year period referred to in subsection 123BE(1) over which the transferee would otherwise be allowed deductions in respect of the property were reduced by one year for each year of income for which a deduction was allowed or allowable under this Subdivision to:
(i) the transferor in respect of the property; or
(ii) if there have been 2 or more prior successive
applications of this section - any of the prior successive transferors in respect of the property.
(Recoupment of expenditure - consequential amendment of assessments)
"(5) Section 170 does not prevent the amendment at any time of an assessment of the transferee where subsection 123BD(4) has applied to:
(a) the transferor in respect of the property; or
(b) if there have been 2 or more prior successive applications of this section - any of the prior successive transferors in respect of the property.
(Disposal by transferee where no roll-over relief - inheritance of deductions)
"(6) If:
(a) after the disposal of the property to the transferee:
(i) the property is lost or destroyed; or
(ii) the transferee disposes of the property; or
(iii) the use of the property by the transferee primarily
and principally for a purpose referred to in section 123BD is otherwise terminated; and
(b) in the case of a disposal by the transferee - this section does not apply to the disposal;
then, for the purposes of the application of section 123C in relation to the loss, destruction, disposal or termination, the total of:
(c) the deductions allowed or allowable to the transferor under this Subdivision in relation to the property; and
(d) if there have been 2 or more prior successive applications of this section - the deductions allowed or allowable to the prior successive transferors under this Subdivision in relation to the property;
are taken to have been deductions allowed or allowable to the transferee under this Subdivision in relation to the property.
(Disposal by transferee where no roll-over relief - inheritance of total expenditure of a capital nature)
"(7) In spite of subsection (4), if:
(a) after the disposal of the property to the transferee:
(i) the property is lost or destroyed; or
(ii) the transferee disposes of the property; or
(iii) the use of the property by the transferee primarily
and principally for a purpose referred to in section 123BD is otherwise
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terminated; and
(b) in the case of a disposal by the transferee - this section does not apply to the disposal;
then, for the purposes of the application of section 123C in relation to the loss, destruction, disposal or termination, the total expenditure of a capital nature of the transferee in respect of the property is to be worked out as if the rule set out in subsection (8) had been applicable to:
(c) the disposal of the property by the transferor to the transferee; and
(d) if there have been 2 or more prior successive applications of this section - each prior successive disposal.
(Rule referred to in subsection (7))
"(8) The rule referred to in subsection (7) is that the transferee had acquired the property for a consideration equal to the total expenditure of a capital nature of the transferor in respect of the property.".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 39
Change in interests in property

39. Section 123F of the Principal Act is amended:
(a) by omitting from subsection (1) "Subject to this section, where" and substituting "If";
(b) by omitting from subsection (1) all the words after "property before the change" (second occurring) and substituting "(in this section called the 'transferor') had, on the day on which the change occurred, disposed of the whole of the property to the person, or all the persons, by whom the property is owned after the change (in this section called the 'transferee')";
(c) by omitting subsection (2) and substituting the following subsections:
"(2) If deductions have been allowed or are allowable under Subdivision A in respect of the property:
(a) unless a joint election for roll-over relief is made by both the transferor and the transferee - this Division applies as if the consideration for the disposal were equal to the market value of the property immediately before the time when the change occurred; or
(b) if a joint election for roll-over relief is made by both the transferor and the transferee - section 123BBA applies to the disposal.
"(2A) If deductions have been allowed or are allowable under Subdivision B in respect of the property:
(a) unless a joint election for roll-over relief is made by both the transferor and the transferee - this Division applies as if the consideration for the disposal were equal to the market value of the property immediately before the time when the change occurred; or
(b) if a joint election for roll-over relief is made by both the transferor and the transferee - section 123BF applies to the disposal.
"(2B) A joint election for roll-over relief has no effect unless it:
(a) is in writing; and
(b) is made:
(i) within 6 months after the later of the following:
(A) the end of the year of income of the transferee in
which the disposal occurred;
(B) the commencement of this subsection; or
(ii) within such further period as the Commissioner
allows; and
(c) contains such information about the transferor's holding of the property as will enable the transferee to work out how section 123BBA or 123BF, as the case may be, will apply to the transferee's holding of the property.
"(2C) If a person dies before the end of the period allowed for making a joint election for roll-over relief, the trustee of the deceased person's estate may be a party to the election on the deceased person's behalf.";
(d) by inserting in subsection (3) "or (2A)" after "subsection (2)".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 40

40. After section 124AM of the Principal Act the following section is inserted:
Roll-over relief where CGT roll-over relief allowed under section 160ZZM, 160ZZMA, 160ZZN, 160ZZNA or 160ZZO or where election for roll-over relief made under section 124AO
(Roll-over relief where CGT roll-over relief allowed)
"124AMAA.(1) This section applies to the disposal of property by a taxpayer (in this section called the 'transferor') to another taxpayer (in this section called the 'transferee') if:
(a) either:
(i) in a case where the transferor is not a partnership -
section 160ZZM, 160ZZMA, 160ZZN or 160ZZO applies to the disposal of the property by the transferor; or
(ii) if the transferor is a partnership - the property is
partnership property of the partnership and section 160ZZNA applies to the corresponding disposal, by all of the partners in the partnership, of their interests in the property; and
(b) deductions have been allowed or are allowable under this Division to the transferor in respect of the property.
(Roll-over relief where joint election made under section 124AO)
"(2) This section also applies if a joint election for roll-over relief is
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made under section 124AO by both the transferor and the transferee referred to in that section in relation to the disposal of property.
(No balancing charges or deductions)
"(3) Section 124AM (which deals with balancing charges and deductions) does not apply to the disposal of the property by the transferor.
(Transferee to inherit certain characteristics from transferor)
"(4) This Division applies as if:
(a) if any part of the expenditure of the transferor in respect of the property is allowable capital expenditure of the transferor - the transferee had acquired the property for a consideration equal to the amount worked out using the formula:
Transferor's - Transferor's deductions + Undeducted excess
expenditure amounts
where:
'Transferor's expenditure' means so much of the total expenditure of a capital nature of the transferor in respect of the property as is allowable capital expenditure of the transferor;
'Transferor's deductions' means the sum of the deductions allowed or allowable to the transferor under this Division in respect of so much of the expenditure of a capital nature of the transferor in respect of the property as is allowable capital expenditure of the transferor;
'Undeducted excess amounts' means the sum of the excess amounts referred to in subsection (5) in respect of the property; and
(b) if no part of the expenditure of the transferor in respect of the property is allowable capital expenditure of the transferor - the transferee had acquired the property for nil consideration; and
(c) if the property is a petroleum prospecting or mining right or petroleum prospecting or mining information:
(i) a notice under section 124AB in respect of the
acquisition of the property had been given to the Commissioner by the transferor and the transferee; and
(ii) the amount specified in the notice were the amount
worked out under paragraph (a) of this subsection; and
(iii) subsections 124AB(3), 124ADG(9) and 124AH(5) were
not applicable to that notice; and
(d) if the property is not a petroleum prospecting or mining right or petroleum prospecting or mining information - subsection 124ADG(8) were not applicable to the disposal of the property; and
(e) if:
(i) the property is a qualifying interest in relation to a
cash bidding exploration permit (within the meaning of section 124ABA); and
(ii) immediately before the disposal, the transferor had
an entitlement to an eligible cash bidding amount (within the meaning of that section) in relation to that permit;
then:
(iii) a notice under section 124ABA in respect of the
acquisition of the property had been given to the Commissioner by the transferor and the transferee; and
(iv) the amount specified in the notice were equal to the
whole of the transferor's entitlement to the eligible cash bidding amount; and
(f) the reference in paragraph 124ADG(3)(a) to a year of income in respect of which a deduction has been allowed or is allowable, or, apart from the operation of subsection 124ADG(6), would have been allowed or would be allowable, in respect of an amount of allowable capital expenditure of the transferee in respect of the property included a reference to a year of income in respect of which a deduction has been allowed or is allowable, or, apart from the operation of subsection 124ADG(6), would have been allowed or would be allowable, in respect of allowable capital expenditure of:
(i) the transferor in respect of the property; or
(ii) if there have been 2 or more prior successive
applications of this section - any of the prior successive transferors in respect of the property.
(Transfer of subsection 124ADG(7) excess amounts)
"(5) If, apart from this subsection, the following conditions are satisfied in relation to a deduction allowable to the transferor under subsection 124ADG(2) in respect of the property:
(a) the deduction is allowable because of the application of subsection 124ADG(7);
(b) the deduction is in respect of an amount (in this subsection called the 'excess amount') of expenditure of a capital nature in respect of the property;
(c) the deduction is allowable for the year of income in which the disposal took place;
then:
(d) the excess amount is taken, under subsection 124ADG(7), to be a deduction that is allowable under subsection 124ADG(2) to the transferee for the year of income in which the disposal took place; and
(e) a deduction is not allowable to the transferor under subsection 124ADG(2) in respect of the excess amount.
(Transfer of subsection 124AH(4) excess amounts)

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"(6) If, apart from this subsection, the following conditions would have been satisfied in relation to a contingent deduction allowable to the transferor under subsection 124AH(1) in respect of the property:
(a) the deduction is allowable because of the application of subsection 124AH(4);
(b) the deduction is in respect of an amount (in this subsection called the 'excess amount') of expenditure of a capital nature in respect of the property;
(c) the contingency is that the transferor had derived assessable income from petroleum in the year of income in which the disposal took place or a subsequent year of income;
then:
(d) the excess amount is taken, under subsection 124AH(4), to be a deduction that is allowable under subsection 124AH(1) to the transferee for:
(i) if the transferee derives assessable income from
petroleum in the year of income in which the disposal took place - that year of income; or
(ii) the first subsequent year of income in which the
transferee derives assessable income from petroleum; and
(e) a deduction is not allowable to the transferor under subsection 124AH(1) in respect of the excess amount.
(Transfer of subsection 124AH(4B) excess amounts)
"(7) If, apart from this subsection, the following conditions would have been satisfied in relation to a contingent deduction allowable to the transferor under subsection 124AH(1) in respect of the property:
(a) the deduction is allowable because of the application of subsection 124AH(4B);
(b) the deduction is in respect of an amount (in this subsection called the 'excess amount') of expenditure of a capital nature in respect of the property;
(c) the contingency is that the transferor had derived assessable income in the year of income in which the disposal took place or a subsequent year of income;
then:
(d) the excess amount is taken, under subsection 124AH(4B), to be a deduction that is allowable under subsection 124AH(1) to the transferee for:
(i) if the transferee derives assessable income in the
year of income in which the disposal took place - that year of income; or
(ii) the first subsequent year of income in which the
transferee derives assessable income; and
(e) a deduction is not allowable to the transferor under subsection 124AH(1) in respect of the excess amount.
(Section 124AB, 124AC, 124ADA, 124ADC and 124ADE and subsection 124ADG(1) - inheritance of threshold conditions)
"(8) If section 124AB, 124AC, 124ADA, 124ADC or 124ADE or subsection 124ADG(1) applied to the expenditure of a capital nature of the transferor in respect of the property, that section or subsection has effect, in relation to the transferee and in relation to the property, as if the threshold conditions that were satisfied in relation to the transferor were satisfied in relation to the transferee.
(Subsection (8) - threshold conditions)
"(9) For the purposes of subsection (8), the following are taken to be threshold conditions in relation to expenditure in respect of property:
(a) a condition that the expenditure was incurred before, at or after a particular time;
(b) if the expenditure was incurred under a contract - a condition that the contract was, or was not, entered into before, at or after a particular time;
(c) if the expenditure was incurred in respect of the construction of property - a condition that the construction commenced, or did not commence, before, at or after a particular time.
(Subsection 124AH(4) - inheritance of threshold conditions)
"(10) If subsection 124AH(4) applied to the expenditure of the transferor in respect of the property, that subsection has effect, in relation to the transferee and in relation to the property, as if the threshold conditions that were satisfied in relation to the transferor were satisfied in relation to the transferee.
(Subsection (10) - threshold conditions)
"(11) For the purposes of subsection (10), the following are taken to be threshold conditions in relation to expenditure in respect of the property:
(a) a condition that the expenditure was incurred before, at or after a particular time;
(b) a condition that the expenditure was incurred during a particular year of income.
(Inheritance of section 124AG election)
"(12) If the transferor made an election under section 124AG in respect of expenditure on the property, the transferee is taken to have made an election under section 124AG in respect of expenditure on the property.
(Rule where no section 124AG election made)
"(13) If the transferor did not make an election under section 124AG in respect of expenditure on the property, the transferee is not entitled to make an election under section 124AG in respect of expenditure on the property.

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(Inheritance of subsection 124AA(2A) threshold conditions)
"(14) If:
(a) the property is plant or articles for the purposes of section 54; and
(b) the expenditure of a capital nature of the transferor in respect of the property is allowable capital expenditure;
then, section 124AA has effect in relation to the transferee and in relation to the property, as if the conditions set out in subsection 124AA(2A) that were satisfied in relation to the transferor were satisfied in relation to the transferee.
(Recoupment of expenditure - consequential amendment of assessments)
"(15) Section 170 does not prevent the amendment at any time of an assessment of the transferee where section 124AQ has applied to:
(a) the transferor in respect of the property; or
(b) if there have been 2 or more prior successive applications of this section - any of the prior successive transferors in respect of the property.
(Disposal by transferee where no roll-over relief - inheritance of deductions)
"(16) If:
(a) after the disposal of the property to the transferee:
(i) the property is lost or destroyed; or
(ii) the transferee disposes of the property; or
(iii) the use of property by the transferee for purposes
of carrying on prescribed petroleum operations or of exploring or prospecting for petroleum (within the meaning of section 124AM) is otherwise terminated; and
(b) in the case of a disposal by the transferee - this section does not apply to the disposal;
then, for the purposes of the application of section 124AM in relation to the loss, destruction, disposal or termination, the total of:
(c) the deductions allowed or allowable to the transferor under this Division in relation to the property; and
(d) if there have been 2 or more prior successive applications of this section - the deductions allowed or allowable to the prior successive transferors under this Division in relation to the property;
are taken to have been deductions allowed or allowable to the transferee under this Division in relation to the property.
(Disposal by transferee where no roll-over relief - inheritance of total expenditure of a capital nature)
"(17) In spite of subsection (4), if:
(a) after the disposal of the property to the transferee:
(i) the property is lost or destroyed; or
(ii) the transferee disposes of the property; or
(iii) the use of the property by the taxpayer for purposes
of carrying on prescribed petroleum operations or of exploring or prospecting for petroleum (within the meaning of section 124AM) is otherwise terminated; and
(b) in the case of a disposal by the transferee - this section does not apply to the disposal;
then, for the purposes of the application of section 124AM in relation to the loss, destruction, disposal or termination, the total expenditure of a capital nature of the transferee in respect of the property is to be worked out as if the rule set out in subsection (18) had been applicable to:
(c) the disposal of the property by the transferor to the transferee; and
(d) if there have been 2 or more prior successive applications of this section - each prior sucessive disposal.
(Rule referred to in subsection (17))
"(18) The rule referred to in subsection (17) is that the transferee had acquired the property for a consideration equal to the total expenditure of a capital nature of the transferor in respect of the property.
(CGT roll-over relief applies to motor vehicles)
"(19) For the purposes of this section, in addition to the effect that sections 160ZZM, 160ZZMA, 160ZZN, 160ZZNA and 160ZZO have apart from this subsection, those sections also have the effect that they would have if a reference in those sections to an asset included a reference to a motor vehicle of a kind mentioned in paragraph 82AF(2)(a).".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 41
Change in interests in property

41. Section 124AO of the Principal Act is amended:
(a) by omitting from subsection (1) "Subject to this section, where" and substituting "If";
(b) by omitting from subsection (1) all the words after "property before the change" (second occurring) and substituting "(in this section called the 'transferor') had, on the day on which the change occurred, disposed of the whole of the property to the person, or all the persons, by whom the property is owned after the change (in this section called the 'transferee')";
(c) by omitting subsection (2) and substituting the following subsections:
"(2) Unless a joint election for roll-over relief is made by both the transferor and the transferee, this Division applies as if the consideration for the disposal were equal to the market value of the property immediately before the time when the change occurred.
"(2A) If a joint election for roll-over relief is made by both the transferor and the transferee, section 124AMAA applies to the disposal.
"(2B) A joint election for roll-over relief has no effect unless it:

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(a) is in writing; and
(b) is made:
(i) within 6 months after the later of the following:
(A) the end of the year of income of the transferee in
which the disposal occurred;
(B) the commencement of this subsection; or
(ii) within such further period as the Commissioner
allows; and
(c) contains such information about the transferor's holding of the property as will enable the transferee to work out how section 124AMAA will apply to the transferee's holding of the property.
"(2C) If a person dies before the end of the period allowed for making a joint election for roll-over relief, the trustee of the deceased person's estate may be a party to the election on the deceased person's behalf.".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 42
Interpretation

42. Section 124B of the Principal Act is amended by inserting the following definitions:
" 'ancillary activities', in relation to a person, means:
(a) the preparation of a site for the carrying on by the person of prescribed mining operations within the meaning of Subdivision A of Division 10; or
(b) the provision of:
(i) water, light or power for use on; or
(ii) access to or communications with;
a site on which prescribed mining operations within the meaning of Subdivision A of Division 10 are carried on, or to be carried on, by the person; or
(c) the treatment of minerals obtained from the carrying on by the person of prescribed mining operations within the meaning of Subdivision A of Division 10; or
(d) the storage (whether before or after treatment) of minerals in relation to the operation of plant for use primarily and principally in the treatment of minerals obtained from the carrying on by the person of prescribed mining operations within the meaning of Subdivision A of Division 10; or
(e) the preparation of a site for the carrying on by the person of eligible quarrying operations within the meaning of Subdivision B of Division 10; or
(f) the provision of:
(i) water, light or power for use on; or
(ii) access to or communications with;
a site on which eligible quarrying operations within the meaning of Subdivision B of Division 10 are carried on, or to be carried on, by the person; or
(g) the treatment of quarry materials obtained from the carrying on by the person of eligible quarrying operations within the meaning of Subdivision B of Division 10; or
(h) the storage (whether before or after treatment) of quarry materials in relation to the operation of plant for use primarily and principally in the treatment of quarry materials obtained from the carrying on by the person of eligible quarrying operations within the meaning of Subdivision B of Division 10; or
(i) the provision of:
(i) water, light or power for use on; or
(ii) access to or communications with;
a site on which prescribed petroleum operations within the meaning of Division 10AA are carried on, or to be carried on, by the person; or
(j) the liquefaction of natural gas obtained from the carrying on by the person of prescribed petroleum operations within the meaning of Division 10AA;
'eligible building site', in relation to a person, means a site on which buildings, or other improvements or plant necessary for the carrying on by the person of:
(a) prescribed mining operations within the meaning of Subdivision A of Division 10; or
(b) eligible quarrying operations within the meaning of Subdivision B of Division 10; or
(c) prescribed petroleum operations within the meaning of Division 10AA;
are or were located, but does not include that part (if any) of the site on which housing and welfare are or were located;
'person' means any of the following:
(a) a company;
(b) a partnership;
(c) a person in the capacity of trustee;
(d) any other person;
'quarry materials' has the same meaning as in Subdivision B of Division 10;
'site' includes a part of a site;
'treatment':
(a) in relation to minerals - has the same meaning as in Subdivision A of Division 10; and
(b) in relation to quarry materials - has the same meaning as in Subdivision B of Division 10.".

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TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 43
Rehabilitation-related activity

43.(1) Section 124BB of the Principal Act is amended by inserting after subsection (1) the following subsection:
"(1A) A reference in this section to the restoration of a site includes a reference to the partial restoration of the site (even if the taxpayer had no intention of completing the restoration).".
(2) Section 124BB of the Principal Act is amended:
(a) by inserting in subsection (1) "or ancillary activities" after "extractive activities";
(b) by inserting in subsection (2) "or ancillary activities or both" after "extractive activities";
(c) by adding at the end the following subsections:
"(3) A reference in this section to a site on which the taxpayer conducted ancillary activities includes a reference to an eligible building site.
"(4) In the case of an eligible building site, a reference in this section to the time at which ancillary activities were first commenced on the site is a reference to the earliest time at which the buildings, improvements or plant concerned were located on the site.".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 44
No deduction for certain expenditure

44. Section 124BC of the Principal Act is amended:
(a) by omitting paragraph (1)(a);
(b) by adding at the end the following subsection:
"(3) A deduction is not allowable under section 124BA for expenditure to the extent to which it is taken into account in calculating an amount of depreciation that is allowable as a deduction.".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 45

45. After section 124G of the Principal Act the following section is inserted:
Roll-over relief where CGT roll-over relief allowed under section 160ZZM, 160ZZMA, 160ZZN, 160ZZNA or 160ZZO
(Roll-over relief where CGT roll-over relief allowed)
"124GA.(1) This section applies to the disposal of property by a taxpayer (in this section called the 'transferor') to another taxpayer (in this section called the 'transferee') if:
(a) either:
(i) in a case where the transferor is not a partnership -
section 160ZZM, 160ZZMA, 160ZZN or 160ZZO applies to the disposal of the property by the transferor; or
(ii) if the transferor is a partnership - the property is
partnership property of the partnership and section 160ZZNA applies to the corresponding disposal, by all of the partners in the partnership, of their interests in the property; and
(b) deductions have been allowed or are allowable under section 124F to the transferor in respect of the property.
(No balancing charges or deductions)
"(2) Section 124G (which deals with balancing charges and deductions) does not apply to the disposal of the property by the transferor.
(Transferee to inherit certain characteristics from transferor)
"(3) This Subdivision applies as if:
(a) the transferee had acquired the property for a consideration equal to the residual capital expenditure immediately before the disposal; and
(b) section 124H had not been enacted.
(Disposal by transferee where no roll-over relief - inheritance of deductions)
"(4) If:
(a) after the disposal of the property to the transferee:
(i) the property is destroyed; or
(ii) the transferee disposes of the property; or
(iii) the use by the transferee of the property for the
purpose for which the access road was primarily and principally constructed is otherwise terminated; and
(b) in the case of a disposal by the transferee - this section does not apply to the disposal;
then, for the purposes of the application of section 124G in relation to the destruction, disposal or termination, the total of:
(c) the deductions allowed or allowable to the transferor under section 124F in relation to the property; and
(d) if there have been 2 or more prior successive applications of this section - the deductions allowed or allowable to the prior successive transferors under section 124F in relation to the property;
are taken to have been deductions allowed or allowable to the transferee under section 124F in relation to the property.".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 46

46. After section 124JC of the Principal Act the following section and Subdivision are inserted:
Roll-over relief where CGT roll-over relief allowed under section 160ZZM, 160ZZMA, 160ZZN, 160ZZNA or 160ZZO
(Roll-over relief where CGT roll-over relief allowed)
"124JD.(1) This section applies to the disposal of a building by a taxpayer
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(in this section called the 'transferor') to another taxpayer (in this section called the 'transferee') if:
(a) either:
(i) in a case where the transferor is not a partnership -
section 160ZZM, 160ZZMA, 160ZZN or 160ZZO applies to the disposal of the building by the transferor; or
(ii) if the transferor is a partnership - the property is
partnership property of the partnership and section 160ZZNA applies to the corresponding disposal, by all of the partners in the partnership, of their interests in the building; and
(b) deductions have been allowed or are allowable under section 124JA to the transferor in respect of the building.
(No balancing charges or deductions)
"(2) Section 124JB (which deals with balancing charges and deductions) does not apply to the disposal of the building by the transferor.
(Transferee to inherit certain characteristics from transferor)
"(3) This Subdivision applies as if:
(a) the transferee had acquired the building for a consideration equal to the residual capital expenditure immediately before the disposal; and
(b) section 124JC had not been enacted.
(Disposal by transferee where no roll-over relief - inheritance of deductions)
"(4) If:
(a) after the disposal of the building to the transferee:
(i) the building is destroyed; or
(ii) the transferee disposes of the building; or
(iii) the use by the transferee of the building for the
purpose for which it was primarily and principally purchased is otherwise terminated; and
(b) in the case of a disposal by the transferee - this section does not apply to the disposal;
then, for the purposes of the application of section 124JB in relation to the destruction, disposal or termination, the total of:
(c) the deductions allowed or allowable to the transferor under section 124JA in relation to the building; and
(d) if there have been 2 or more prior successive applications of this section - the deductions allowed or allowable to the prior successive transferors under section 124JA in relation to the building;
are taken to have been deductions allowed or allowable to the transferee under section 124JA in relation to the building.
"Subdivision C - Non-arm's length transactions
Transactions between persons not at arm's length
"124JE. If:
(a) a person has purchased from another person a unit of property where:
(i) the vendor had incurred capital expenditure of a kind
in respect of which deductions are or have been allowable under this Division; or
(ii) the expenditure of the purchaser in acquiring the
unit of property is capital expenditure of a kind in respect of which deductions are or have been allowable under this Division; and
(b) it would be concluded that, having regard to any connection between the vendor and the purchaser or to any other relevant circumstances, those persons were not dealing with each other at arm's length; and
(c) the purchase price is greater or lesser than the market value of the unit at the time of the purchase;
the purchase price is, for all purposes of the application of this Act in relation to the vendor or the purchaser, taken to have been the amount of the market value of the unit at the time of the purchase.".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 47

47. After section 124P of the Principal Act the following section is inserted:
Roll-over relief where CGT roll-over relief allowed under section 160ZZM, 160ZZMA, 160ZZN, 160ZZNA or 160ZZO or where election for roll-over relief made under section 122W
(Roll-over relief where CGT roll-over relief allowed)
"124PA.(1) This section applies to the disposal of a unit of industrial property by a taxpayer (in this section called the 'transferor') to another taxpayer (in this section called the 'transferee') if:
(a) either:
(i) in a case where the transferor is not a partnership -
section 160ZZM, 160ZZMA, 160ZZN or 160ZZO applies to the disposal of the unit by the transferor; or
(ii) if the transferor is a partnership - the unit is
partnership property of the partnership and section 160ZZNA applies to the corresponding disposal, by all of the partners in the partnership, of their interests in the unit; and
(b) deductions have been allowed or are allowable under this Division to the transferor in respect of the unit; and
(c) no part of the cost of the unit to the transferor is attributable to expenditure covered by subsection 124K(2A) or 124KA(1).
(Roll-over relief where joint election made under section 124W)
"(2) This section also applies if a joint election for roll-over relief is
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made under subsection 124W(3) by both the transferor and the transferee referred to in that subsection in relation to the disposal of a unit of industrial property.
(No balancing charges or deductions)
"(3) Sections 124N and 124P (which deal with balancing charges and deductions) do not apply to the disposal of the unit by the transferor.
(Transferee to inherit certain characteristics from transferor)
"(4) This Division applies as if:
(a) the cost of the unit of industrial property in relation to the transferee were equal to the residual value of the unit in relation to the transferor immediately before the disposal; and
(b) the effective life of the unit of industrial property determined in relation to the transferor immediately before the disposal under whichever of sections 124U and 124UA is applicable were the effective life of the unit of industrial property in relation to the transferee; and
(c) if the transferor had not made an election under section 124UA in relation to the unit of industrial property - the transferee were not entitled to make an election under that section in relation to the unit.
(Disposal by transferee where no roll-over relief - inheritance of deductions)
"(5) If:
(a) the transferee disposes of the unit of industrial property; and
(b) this section does not apply to the disposal;
then, for the purposes of the application of subsection 124P(3) in relation to the disposal:
(c) the total of:
(i) the deductions allowed or allowable to the transferor
under this Division in relation to the unit; and
(ii) if there have been 2 or more prior successive
applications of this section - the deductions allowed or allowable to the prior successive transferors under this Division in relation to the unit;
are taken to have been deductions allowed or allowable to the transferee under this Division in relation to the unit; and
(d) the total of:
(i) the amounts included in the transferor's assessable
income under section 124P in relation to the unit; and
(ii) if there have been 2 or more prior successive
applications of this section - the amounts included in the prior successive transferors' assessable incomes under that section in relation to the unit;
are taken to have been included in the transferee's assessable income under that section in relation to the unit.".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 48
Disposal of unit of industrial property on change of partnership etc.

48. Section 124W of the Principal Act is amended:
(a) by inserting in subsection (2) "(in this section called the 'transferor')" after "before the change";
(b) by inserting in subsection (2) "(in this section called the 'transferee')" after "after the change";
(c) by omitting subsections (3), (4) and (5) and substituting the following subsections:
"(3) Unless a joint election for roll-over relief has been made by both the transferor and the transferee, this Division applies as if the consideration for the disposal were equal to the market value of the unit immediately before the change.
"(4) If a joint election for roll-over relief has been made by both the transferor and the transferee, section 124PA applies to the disposal.
"(5) A joint election for roll-over relief has no effect unless it:
(a) is in writing; and
(b) is made:
(i) within 6 months after the later of the following:
(A) the end of the year of income of the transferee in
which the disposal occurred;
(B) the commencement of this subsection; or
(ii) within such further period as the Commissioner
allows; and
(c) contains such information about the transferor's holding of the unit as will enable the transferee to work out how section 124PA will apply to the transferee's holding of the unit.
"(6) If a person dies before the end of the period allowed for making a joint election for roll-over relief, the trustee of the deceased person's estate may be a party to the election on the deceased person's behalf.".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 49
Interpretation

49. Section 160APA of the Principal Act is amended by inserting ", apart from section 45Z," after "a dividend that" in paragraph (f) of the definition of "frankable dividend".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 50
Indexation of indexed cost base limit

50. Section 160Q of the Principal Act is amended by omitting from subsection (7) all the words preceding "before" and substituting "The Commissioner must publish by written notice".

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TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 51
Transfer of partnership assets to wholly-owned company

51. Section 160ZZNA of the Principal Act is amended:
(a) by inserting in subparagraph (10)(d)(i) "Net" before "ICB" (wherever occurring);
(b) by adding at the end of the definition of "ICB of post-CGT interests" in subparagraph (10)(d)(i) ", being that sum reduced by the amount worked out in relation to the taxpayer using the reduction formula in subsection (10A)";
(c) by inserting in subparagraph (10)(d)(ii) "Net" before "RCB" (wherever occurring);
(d) by adding at the end of the definition of "RCB of post-CGT interests" in subparagraph (10)(d)(ii) ", being that sum reduced by the amount worked out in relation to the taxpayer using the reduction formula in subsection (10A)";
(e) by inserting after subsection (10) the following subsection:
"(10A) This is the reduction formula referred to in subparagraphs (10)(d)(i) and (ii):
Assumed x Ex-partner's x Post-20 September 1985
liabilities interest replacement shares
Replacement shares
where:
'Assumed liabilities' means the total amount of any liability or liabilities in respect of the eligible asset assumed by the company in connection with the disposal of the eligible asset;
'Ex-partner's interest' means the taxpayer's percentage interest in the eligible asset immediately before its disposal;
'Post-20 September 1985 replacement shares' means the number of post-20 September 1985 replacement shares acquired by the taxpayer;
'Replacement shares' means the total number of replacement shares acquired by the taxpayer.".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 52
Explanation of terms: investment, investor, investment body

52. Section 202D of the Principal Act is amended:
(a) by inserting in paragraph (3)(a) "other than an entrepot nominee company" after "a body corporate";
(b) by inserting after subsection (3) the following subsection:
"(3A) In the case of an investment that is a relevantPart VA investment for the purposes of section 221YHZLA, subsection (3) does not apply to a person's right to receive income if:
(a) the body corporate concerned has received a payment of the kind referred to in paragraph 221YHZLA(2)(a); and
(b) the circumstances referred to in subparagraph 221YHZLA(2)(c)(i) or (ii) in relation to an applicant exist in relation to the body corporate.";
(c) by adding at the end the following subsection:
"(9) For the purposes of subsection (3), an entrepot nominee company is a body corporate that is:
(a) controlled solely by a securities dealer or by 2 or more persons each of whom is a securities dealer; and
(b) operated for the sole purpose of facilitating settlement of security transactions.".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 53
Interpretation

53. Section 221YHZA of the Principal Act is amended:
(a) by omitting from subsection (1) the definition of "unattributed income" and substituting the following definition:
" 'unattributed income':
(a) in relation to a non-transferable Part VA investment, means income in respect of the investment that becomes payable to the investor at a time when the investor's tax file number is not taken, for the purposes of Part VA, to have been quoted in connection with the investment, other than such income that becomes payable at a time when:
(i) a provision of Division 5 of Part VA that previously
applied to the investor has ceased to apply; and
(ii) the investment body concerned has not been informed
of anything that would result in the provision ceasing to apply; or
(b) in relation to a transferable Part VA investment, means income payable in respect of that investment to an investor who, at the books closing time applicable to the income, is not or was not taken, for the purposes ofPart VA, to have quoted the investor's tax file number in connection with the investment, other than such income that becomes payable at a time when:
(i) a provision of Division 5 of Part VA that previously
applied to the investor has ceased to apply; and
(ii) the investment body concerned has not been informed
of anything that would result in the provision ceasing to apply.";
(b) by omitting subsection (4) and substituting the following subsections:
"(4) For the purposes of this Division (other than subparagraphs (a)(ii) and (b)(ii) of the definition of 'unattributed income' in subsection (1)), if the investment body in relation to an investment of the kind mentioned in item 5 or item 7 in the table in subsection 202D(1) is not liable to pay income in respect of the investment, any other person who is liable to pay it is taken to be the investment body.

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"(5) For the purposes of this Division, if income in relation to a Part VA investment becomes payable to a person because the person was registered with the investment body as the investor as at a particular time, that time is the books closing time in relation to the income.".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 54
Credits in respect of deducted amounts

54. Section 221YHZK of the Principal Act is amended by omitting subsection (5).

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 55

55. After section 221YHZL of the Principal Act the following section is inserted:
Refunds in relation to certain credit entitlements
"221YHZLA.(1) In this section:
'relevant credit entitlement' means an entitlement to a credit under subsection 221YHZK(1), (2) or (3) in respect of a deduction made under subsection 221YHZC(1A);
'relevant Part VA investment' means an investment of a kind mentioned in item 3, 5 or 6 in the table in section 202D;
'securities lending arrangement' means an agreement covered by subsection 26BC(3).
"(2) Where, on an application made by a person, the Commissioner is satisfied that:
(a) the applicant has received payment of part of the income due at a particular time in respect of a relevant Part VA investment; and
(b) the applicant has a relevant credit entitlement in respect of the income; and
(c) either:
(i) at the books closing time applicable to the income,
the applicant was under an obligation to transfer the investment to another person under a contract for the sale of the investment where the contract is:
(A) of the kind known as a 'cum-dividend' contract; or
(B) of the kind known as a 'cum-interest' contract; or
(ii) all of the following conditions are satisfied:
(A) at the time the payment of income was made, the
applicant was under an obligation to pay the income to the lender under a securities lending arrangement;
(B) the obligation was incurred by the applicant as a
borrower under the arrangement;
(C) the books closing time applicable to the income was
reached during the borrowing period;
the Commissioner must refund to the applicant an amount equal to the credit entitlement.
"(3) An application is to be in the form approved by the Commissioner.
"(4) A person who:
(a) receives a refund; or
(b) has an application pending;
under subsection (2) in respect of a relevant credit entitlement may not claim the entitlement for the purposes of subsection 221YHZL(2).
"(5) A person may not make an application under subsection (2) if the relevant credit entitlement has been claimed for the purposes of subsection 221YHZL(2).
"(6) The regulations may make provision in relation to the giving of notice of, and reports concerning:
(a) the transfer of relevant Part VA investments under a contract of the kind referred to in subparagraph (2)(c)(i); or
(b) the payment of income to the lender under a securities lending arrangement;
and, without limiting the provision that may be made by regulations made for the purposes of this subsection, may provide that any such notice or report is to be in a form approved by the Commissioner.
"(7) A notice or report, or a copy of a notice or report, required under regulations made for the purposes of subsection (6) is a record for the purposes of section 262A.".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 56
Keeping of records

56. Section 262A of the Principal Act is amended by inserting after subsection (4) the following subsections:
"(4AA) A person who is a party to a joint election for roll-over relief made under section 59AA, 122R, 123F, 124AO or 124W must retain the election, or a copy, until the end of 5 years after the earlier of:
(a) the disposal by the person of the property; or
(b) the loss or destruction of the property.
"(4AB) A person who brings into existence a notice under section 62AAC, 62AAE or 62AAF must retain the notice, or a copy, until the end of 5 years after the notice came into existence.
"(4AC) If subsection 58(1), 73AA(1), 122JAA(1), 122JG(1), 123BBA(1), 123BF(1), 124AMAA(1), 124GA(1), 124JD(1) or 124PA(1) applies to the disposal of property by the transferor referred to in that subsection to the transferee referred to in that subsection:
(a) the transferor must give to the transferee, within the period specified in subsection (4AD), a notice containing such information about the
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transferor's holding of the property as will enable the transferee to work out how section 58, 73AA, 122JAA, 122JG, 123BBA, 123BF, 124AMAA, 124GA, 124JD or 124PA, as the case may be, will apply to the transferee's holding of the property; and
(b) the transferee must retain the notice, or a copy, until the end of 5 years after the earlier of:
(i) the disposal by the person of the property; or
(ii) the loss or destruction of the property.
"(4AD) The notice referred to in subsection (4AC) must be given within 6 months after the later of the following:
(a) the end of the year of income of the transferee in which the disposal occurred;
(b) the commencement of subsection (4AC);
or within such further period as the Commissioner allows.
"(4AE) A person who makes an election under paragraph 54A(1)(a) in relation to a unit of property must retain the election, or a copy, until the end of 5 years after the earlier of:
(a) the disposal by the person of the property; or
(b) the loss or destruction of the property.".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 57
Interpretation

57. Section 317 of the Principal Act is amended by inserting the following definitions:
" 'widely distributed finance share' has the meaning given by section 327A;
'widely distributed finance share dividend' means a dividend in respect of a widely distributed finance share.".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 58

58. After section 327 of the Principal Act the following section is inserted:
Widely distributed finance shares
(Meaning of 'widely distributed finance shares')
"327A.(1) For the purposes of this Part, a share in a company is a widely distributed finance share if both:
(a) either:
(i) the company is an eligible listed company; or
(ii) the aggregate of the eligible share interests in the
company held by an eligible listed company is 90% or more; and
(b) the share is a recognised finance share.
(Meaning of 'eligible listed company')
"(2) For the purposes of this section, a company is an eligible listed company at a particular time during a statutory accounting period of the company if:
(a) shares in the company (other than shares entitled to a fixed rate of dividend whether with or without a further right to participate in profits) are listed for quotation in the official list of a stock exchange in Australia or elsewhere; and
(b) none of the following subparagraphs apply:
(i) at any time during the statutory accounting period, a
single entity, or less than 21 entities, held, or were entitled to acquire, 75% or more of the paid-up share capital of the company (other than capital represented by shares entitled to a fixed rate of dividend only);
(ii) at any time during the statutory accounting period, a
single entity, or less than 21 entities held, or were entitled to acquire, 75% or more of the total rights (other than rights arising in respect of shares entitled to a fixed rate of dividend only) of shareholders to vote, or participate in any decision-making, concerning any of the following:
(A) the making of distributions of capital or profits of
the company to its shareholders;
(B) the constituent document of the company;
(C) any variation of the share capital of the company;
(iii) 75% or more of the total amount of all of the
dividends paid by the company (other than dividends paid in respect of shares entitled to a fixed rate of dividend only) during the statutory accounting period was paid to a single entity or to less than 21 entities;
(iv) dividends (other than dividends paid in respect of
shares entitled to a fixed rate of dividend only) were not paid by the company during the statutory accounting period but it would be concluded that, if such dividends had been paid by the company during the statutory accounting period, 75% or more of those dividends would have been paid to a single entity or to less than 21 entities.
(Meaning of 'recognised finance shares')
"(3) For the purposes of this section, shares in a company are recognised finance shares if all the following conditions are satisfied:
(a) the shareholder is not an associate of the company;
(b) having regard to:
(i) the manner in which the amount of dividends in respect
of the shares are to be calculated; and
(ii) the conditions applicable to the payment of dividends
in respect of the shares; and
(iii) any other relevant matters;

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the payment of the dividends in respect of the shares may reasonably be regarded as equivalent to the payment of interest on a loan;
(c) having regard to:
(i) the arrangements under which the shares were offered
for subscription; and
(ii) the ordinary business practices of brokers, agents,
underwriters or other persons who took part in the arrangements for the issue of the shares; and
(iii) the arrangements that were made for dealing with
applications that were made for subscription of the shares; and
(iv) any circumstances indicating the existence, at the
time of the issue of the shares, of any arrangement for any of the shares to be offered for subscription, or purchased after subscription, by entities connected:
(A) with each other; or
(B) with the company issuing the shares; or
(C) with a person by whom the amounts raised by the
subscription, or amounts derived directly or indirectly from those amounts, were intended to be used;
it is reasonable to regard the shares as having been issued with a view to public subscription or purchase or other wide distribution among investors.
(Meaning of 'eligible share interest')
"(4) For the purposes of this section, a person holds an eligible share interest in a company at a particular time equal to the percentage of the company's total paid-up share capital (excluding recognised finance shares) beneficially owned by the person at that time.
(Extended meaning of 'eligible share interest': tiers of companies)
"(5) For the purposes of this section, if:
(a) a person holds an eligible share interest (including an eligible share interest that is taken to be held because of one or more previous applications of this subsection) in a company (in this subsection called the 'first level company'); and
(b) the first level company holds an eligible share interest in another company (in this subsection called the 'second level company');
the person is taken to hold an eligible share interest in the second level company equal to the percentage calculated using the formula:
First level percentage ;ts Second level percentage where:
'First level percentage' means the percentage of the eligible share interest held by the person in the first level company;
'Second level percentage' means the percentage of the eligible share interest held by the first level company in the second level company.
(Definitions)
"(6) In this section:
'eligible listed company' has the meaning given by subsection (2);
'eligible share interest' has the meaning given by subsections (4)'recognised finance share' has the meaning given by subsection (3).".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 59
Direct attribution interest in a CFC or CFT

59. Section 356 of the Principal Act is amended by inserting in subsection (4) "and widely distributed finance shares" after "Eligible finance shares".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 60
Direct attribution account interest in a company

60. Section 366 of the Principal Act is amended by inserting in subsection (5) "and widely distributed finance shares" after "Eligible finance shares".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 61
Notional allowable deduction for eligible finance share dividends and widely distributed finance share dividends

61. Section 394 of the Principal Act is amended:
(a) by inserting in paragraph (a) "or a widely distributed finance share dividend" after "eligible finance share dividend";
(b) by inserting in paragraph (b) "or 327A(3)(b), as the case requires," after "327(d)".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 62
Additional notional exempt income - unlisted or listed country CFC

62. Section 402 of the Principal Act is amended by inserting in paragraphs (2)(c) and (d) "(other than a widely distributed finance share dividend)" after "non-portfolio dividend".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 63
Application of amendments - general
(Meaning of "amended Act")

63.(1) In this section:
"amended Act" means the Principal Act as amended by this Act.
(Education entry payments)
(2) The amendments made by sections 7, 8 and 9 apply to payments received on or after 1 January 1992.
(Intercorporate dividend rebates: shareholder a trustee/partnership)
(3) The amendments made by sections 10, 13 and 25, subsections 31(2) and 32(2) and sections 33 and 49 apply in relation to dividends paid after 17 August 1976.
(Trading stock)

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(4) The amendment made by section 14 applies to expenditure incurred after 19 December 1991.
(Gazette notices)
(5) The amendments made by sections 18 and 50 apply in relation to the 1992-93 year of income and to all subsequent years of income.
(Capital deductions: roll-overs etc.)
(6) Subject to subsection (7) of this section, the amendments made by sections 21, 22, 23, 27, 34 to 41 (inclusive) and 45 to 48 (inclusive) apply to disposals of property after 19 December 1991.
(Scientific research buildings, timber operations and timber mill buildings: non-arm's transactions)
(7) Subsection 73A(4A) and section 124JE of the amended Act apply to purchases of property after 19 December 1991.
(Core technology expenditure - non-arm's length dealing)
(8) The amendment made by paragraph 28(b) applies to core technology expenditure incurred by an eligible company on or after19 December 1991.
(Guaranteed returns to investors - exclusion of core technology expenditure)
(9) The amendment of subsection 73CA(6) of the Principal Act made by this Part applies to expenditure incurred by an eligible company on or after 19 December 1991.
(Currency exchange losses)
(10) The amendments made by section 30 apply to currency exchange losses incurred on or after 19 December 1991.
(Corporate unit trusts and public trading trusts)
(11) The amendments made by subsections 31(1) and 32(1) apply to dividends paid after the commencement of this subsection.
(Mine site rehabilitation)
(12) The amendments made by sections 42, 43 and 44 apply in relation to expenditure incurred on or after 1 July 1991.
(CGT roll-over of partnership property)
(13) The amendments made by section 51 apply in relation to disposals of assets after 6 December 1990.
(Widely distributed finance shares: direct attribution interest)
(14) The amendment made by section 59 applies in relation to the calculation of a direct attribution interest in a CFC at a particular time, whether before or after the commencement of that section.
(Widely distributed finance shares: direct attribution account interest)
(15) The amendment made by section 60 applies in relation to the calculation of a direct attribution account interest in a company at a particular time, whether before or after the commencement of that section.
(Widely distributed finance shares: calculation of attributable income)
(16) The amendment made by section 61 applies in relation to the calculation of attributable income of any eligible period, whether beginning before or after the commencement of that section.
(Widely distributed finance shares: section 402 non-portfolio dividends)
(17) The amendment made by section 62 applies in relation to dividends, whether paid before or after the commencement of that section.

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 64
Application of depreciation amendments: effective life;
100% depreciation; broadbanding; loading and pooling
(Definitions)

64.(1) In this section:
"amended Act" means the Principal Act as amended by this Act;
"old depreciation percentage" means the annual depreciation per centum fixed under the repealed subsection 55(1) of the Principal Act, disregarding any notional application of the repealed section 57AG of the Principal Act;
"post-12 March 1991 property", in relation to a taxpayer, means:
(a) a unit of property that was acquired by the taxpayer under a contract entered into after 12 March 1991; or
(b) a unit of property that was constructed by the taxpayer and commenced to be constructed after 12 March 1991;
"pre-13 March 1991 property", in relation to a taxpayer, means:
(a) a unit of property that was acquired by the taxpayer under a contract entered into before 13 March 1991; or
(b) a unit of property that was constructed by the taxpayer and commenced to be constructed before 13 March 1991;
"recognised holding period", in relation to post-12 March 1991 property of a taxpayer, in relation to the taxpayer's 1 July 1991 year of income, means the period:
(a) commencing on the later of the following:
(i) the day on which the property was first used by the
taxpayer for assessable income-producing purposes;
(ii) the beginning of the year of income; and
(b) ending on the earlier of the following:
(i) the day on which the taxpayer ceased, or last ceased,
to use the property for assessable income-producing purposes;
(ii) the end of the year of income;
"1 July 1991 year of income" means the year of income in which1 July 1991 occurred.
(Meaning of "notional application of repealed section 57AG")

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(2) In this section:
(a) a reference to the notional application of the repealed section 57AG of the Principal Act in relation to an old depreciation percentage is a reference to the application that section would have in relation to that percentage if:
(i) that section and section 55 of the Principal Act had
not been repealed; and
(ii) subsection 73A(5) of the Principal Act had not been
repealed; and
(b) a reference to the notional application of the repealed section 57AG of the Principal Act in relation to a percentage calculated using a formula in section 55 of the amended Act is a reference to the application that that repealed section would have had in relation to that percentage if:
(i) it had not been repealed; and
(ii) a reference in the repealed section to the annual
depreciation per centum fixed under subsection 55(1) of the Principal Act were a reference to the percentage calculated using that formula; and
(iii) a reference in the repealed section to property in
respect of which subsection 55(2) applies were a reference to property covered by subsection 55(4) of the amended Act; and
(iv) a reference in the repealed section to property in
respect of which subsection 73A(5) applies were a reference to property covered by subsection 55(3A) of the amended Act.
(Meaning of "use for assessable income-producing purposes")
(3) For the purposes of this section, a unit of property is taken to be used for assessable income-producing purposes by a taxpayer if, and only if, the property is:
(a) used by the taxpayer for the purpose of producing assessable income; or
(b) installed ready for use for that purpose and held in reserve by the taxpayer.
(General application of non-pooling amendments: 1 July 1991 year of income and subsequent years)
(4) Subject to this section, the amendments made by sections 15 to 20 (inclusive) and subsection 26(2) apply to assessments in respect of income of the 1 July 1991 year of income and of all subsequent years of income.
(Old depreciation percentage continues to apply to pre-13 March 1991 property: post-1990-91 years)
(5) If:
(a) a taxpayer's year of income is later than the 1990-91 year of income; and
(b) the taxpayer's property is pre-13 March 1991 property;
section 55 of the amended Act has the effect in relation to the property and in relation to the year of income that it would have if subsection (2) of that section were omitted and the following subsection were substituted:
"(2) (Step 1: Raw percentage) The raw percentage applicable to the property equals the old depreciation percentage applicable to the property.".
(Taxpayers with substituted accounting periods and post-12 March 1991 property: post-1990-91 years)
(6) If:
(a) the taxpayer's 1 July 1991 year of income is later than the 1990-91 year of income; and
(b) the taxpayer's property is post-12 March 1991 property; and
(c) any part of the taxpayer's recognised holding period occurred before 1 July 1991;
the amended Act has effect as if the annual depreciation percentage applicable to the property under section 55 of that Act in relation to that year of income were calculated using the formula:
Pre- Notional Post- Notional
1 July former 1 July new annual
1991 annual 1991 depreciation
days x depreciation + days x percentage
Days in percentage Days in
recognised recognised
holding holding
period period
where:
"Pre-1 July 1991 days" means the number of days in the taxpayer'srecognised holding period that occurred before 1 July 1991;
"Days in recognised holding period" means the number of days in the taxpayer's recognised holding period;
"Notional former annual depreciation percentage" means the percentage that, apart from this subsection, would have been the annual depreciation percentage applicable to the property in relation to that year of income if subsection 55(2) of the amended Act were omitted and the following subsection were substituted:
"(2) (Step 1: Raw percentage) The raw percentage applicable to the property equals the old depreciation percentage applicable to the property.";
"Post-1 July 1991 days" means the number of days in the taxpayer's"Notional new annual depreciation percentage" means the percentage that, apart from this subsection, is the annual depreciation percentage applicable to the property in relation to that year of income.
(100% depreciation does not apply to pre-1 July 1991 property)
(7) If either:

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(a) a unit of property was acquired by a taxpayer under a contract entered into before 1 July 1991; or
(b) a unit of property was constructed by a taxpayer and commenced to be constructed before 1 July 1991;
section 55 of the amended Act has the effect in relation to the property that it would have if subsection (3) of that section had not been enacted.
(Old depreciation percentage continues to apply to pre-13 March 1991 property: pre-1991-92 years)
(8) If:
(a) a taxpayer's 1 July 1991 year of income is earlier than the 1991-92 year of income; and
(b) the taxpayer's property is pre-13 March 1991 property;
the amended Act has effect as if the annual depreciation percentage applicable to the property under section 55 of that Act in relation to that year of income were equal to the percentage that would have been the annual depreciation per centum fixed under the repealed section 55 of the Principal Act if:
(c) sections 55 and 57AG of the Principal Act had not been repealed; and
(d) subsection 73A(5) of the Principal Act had not been repealed. (Taxpayers with substituted accounting periods and post-12 March 1991 property: pre-1991-92 years)
(9) If:
(a) a taxpayer's 1 July 1991 year of income is earlier than the 1991-92 year of income; and
(b) the taxpayer's property is post-12 March 1991 property; and
(c) any part of the taxpayer's recognised holding period occurred before 1 July 1991;
section 55 of the amended Act has the effect in relation to the property and in relation to that year of income that it would have if subsections (5), (6), (7) and (8) of that section were omitted and the following subsection were substituted:
"(5) (Step 4: annual depreciation percentage) If none of steps 2, 2A and 3 apply, the annual depreciation percentage is calculated using the following formula:
Pre- Post-
1 July 1 July
1991 1991
days x Loaded old + days x Loaded
Days in depreciation Days in raw
recognised percentage recognised percentage
holding holding
period period
where:
'Pre-1 July 1991 days' means the number of days in the taxpayer's'Days in recognised holding period' means the the number of days in the taxpayer's recognised holding period;
'Loaded old depreciation percentage' means the annual depreciation per centum fixed under the repealed subsection 55(1) in relation to the property, as increased by any notional application of the repealed section 57AG;
'Post-1 July 1991 days' means the number of days in the taxpayer's'Loaded raw percentage' means:
(a) if the repealed section 57AG would have been applicable to the property if it had not been repealed - the raw percentage applicable to the property, as increased by any notional application of that section; or
(b) in any other case - the raw percentage applicable to the property.".
(Application of pooling amendments: 1991-92 year of income and subsequent years)
(10) Section 62AAE of the amended Act does not apply to allocations for years of income earlier than the 1991-92 year of income.

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 65
Application of tax file number amendments
(Meaning of "amended Act")

65.(1) In this section:
"amended Act" means the Principal Act as amended by this Act.
(Meaning of "person")
(2) For the purposes of subsections (4) and (5), a reference to a person is a reference to a person who, if subsection 221YHZA(4) of the amended Act had commenced on 1 July 1991, would have been an investment body for the purposes of Division 3B of Part VI of the Principal Act.
(Entrepot nominee companies)
(3) The amendments made by paragraphs 52(a) and (c) apply to a right to receive income accruing on or after 1 July 1991.
(Certain persons taken to be investment bodies)
(4) Subject to subsection (5), subsection 221YHZA(4) of the amended Act applies to a person as if the subsection had commenced on 1 July 1991 and anything done by the person in the capacity of an investment body before the commencement of this Act has the same effect, and the rights and liabilities of persons are the same, as if the subsection had so commenced.
(Circumstances in which persons taken not to be investment bodies)
(5) Subsection 221YHZA(4) of the amended Act does not apply to a person
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where such application would give rise to an offence under subsection 221YHZC(1A) of the amended Act in respect of a payment of income, made before the commencement of this Act, relating to an investment of the kind mentioned in item 5 in the table referred to in subsection 221YHZA(4) of the amended Act.

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 66
Transitional - intercorporate dividend rebate amendments

66.(1) If a notice of an assessment of a taxpayer's taxable income of a year of income was served on the taxpayer before 19 December 1991:
(a) the taxpayer is not entitled to object against the assessment on the grounds that the assessment does not give effect to the amendments made by any or all of sections 10, 13 and 25, subsections 31(2) and 32(2) and sections 33 and 49; and
(b) the assessment must not be amended for the purpose of giving effect to those amendments.
(2) This section has effect in spite of anything in this Act, in the Taxation Administration Act 1953, or in section 170 of the Principal Act.

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 67
Transitional - section 55 of the amended Act

67. Section 55 of the Principal Act as amended by this Act has the effect that it would have if the following word and paragraph were inserted after paragraph (6)(c):
"and (d) a deduction has not been allowed, and is not allowable, to the taxpayer in relation to any year of income in respect of the property in accordance with repealed section 57AE, 57AH or 57AL (as those sections continue to apply in spite of their repeal by the Taxation Laws Amendment Act (No. 4) 1988);".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 68
Transitional - repealed paragraph 56(1)(b) of the Principal Act

68. Paragraph 56(1)(b) of the Income Tax Assessment Act 1936 (as that paragraph continues to apply in spite of its repeal by the Taxation Laws Amendment Act (No. 4) 1988) has effect, in relation to the year of income in which 1 July 1991 occurred or a subsequent year of income, as if the reference to the percentage fixed by or under section 55 of the Principal Act were a reference to the annual depreciation percentage fixed under section 55 of the Principal Act as amended by this Act.

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 69
Transitional - repealed section 57AH of the Principal Act

69. Section 57AH of the Income Tax Assessment Act 1936 (as that section continues to apply in spite of its repeal by the Taxation Laws Amendment Act (No. 4) 1988) has the effect that it would have if:
(a) a reference to subsection 55(2) were a reference to that subsection as in force immediately before its repeal by this Act; and
(b) a reference to subsection 73A(5) were a reference to that subsection as in force immediately before its repeal by this Act.

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 70
Transitional - repealed section 57AL of the Principal Act

70. Section 57AL of the Income Tax Assessment Act 1936 (as that section continues to apply in spite of its repeal by the Taxation Laws Amendment Act (No. 4) 1988) has the effect that it would have if a reference to section 55 were a reference to section 55 as in force immediately before its repeal by this Act.

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 71
Transitional - section 58 of the amended Act
(This section applies if section 58 of the amended Act applies)

71.(1) If section 58 of the Principal Act as amended by this Act (in this section called the "roll-over section") applies to the disposal of a unit of property by the transferor to the transferee referred to in that section, the following provisions have effect.
(Repealed section 57AG: special rules)
(2) If the repealed section 57AG of the Principal Act (which dealt with special depreciation loadings) (as that section continues to apply in spite of its repeal by this Act) applied to the transferor in relation to the property, then, that section has effect, in relation to the transferee and in relation to the property, as if:
(a) the conditions set out in repealed subsection 57AG(2) of the Principal Act that were satisfied in relation to the transferor were satisfied in relation to the transferee; and
(b) the conditions set out in whichever of repealed paragraphs 57AG(3)(a) and (b) of the Principal Act that were satisfied in relation to the transferor were satisfied in relation to the transferee.
(Pre-1988 property: modified roll-over rules)
(3) If the amendments covered by subsection 54(7) of the Taxation Laws Amendment Act (No. 4) 1988 did not apply to the transferor in relation to the property:
(a) those amendments are taken not to have applied to the transferee in relation to the property; and
(b) paragraphs (4)(a) and (b) of the roll-over section do not apply in relation to the disposal of the property; and
(c) if the depreciation allowable to the transferor in respect of the
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property for the year of income in which the disposal occurred was calculated in accordance with paragraph 56(1)(a) of the Principal Act - the provisions of the Income Tax Assessment Act 1936 relating to depreciation apply as if:
(i) the transferee were not entitled to exercise an option
in accordance with repealed section 56A of the Principal Act; and
(ii) the transferee had acquired the unit of property for
a consideration equal to the depreciated value of the property immediately before the time of disposal (worked out on the assumption that subsection 60(2) of the Principal Act had not been enacted); and
(d) if:
(i) the depreciation allowable to the transferor in
respect of the property for the year of income in which the disposal occurred was calculated in accordance with repealed paragraph 56(1)(b) of the Principal Act; or
(ii) both:
(A) the depreciation allowable to the transferor in
respect of the property for the year of income in which the disposal occurred was calculated in accordance with repealed section 57AK or 57AM or repealed section 57AE, 57AH or 57AL of the Principal Act (as those sections continue to apply in spite of their repeal by the Taxation Laws Amendment Act (No. 4) 1988); and
(B) none of the provisions referred to in sub-subparagraph
(A) apply to the transferee in respect of the property;
then, the provisions of the Income Tax Assessment Act 1936 relating to depreciation apply as if:
(iii) the transferee had exercised the option referred to
in that paragraph in relation to the property; and
(iv) the transferee were not entitled to exercise the
further option referred to in repealed section 56A of the Principal Act; and
(v) the transferee had acquired the unit of property for a
consideration equal to the cost of the unit to the transferor; and
(vi) depreciation were not allowable to the transferee in
respect of:
(A) so much of the cost of the property as was allowed
or allowable to the transferor in respect of depreciation in relation to the property (worked out as if section 61 had not been enacted); or
(B) if there have been 2 or more successive applications
of the roll-over section - so much of the cost of the property as was allowed or allowable to the prior successive transferors in respect of depreciation in relation to the property (worked out as if section 61 had not been enacted); and
(vii) the depreciated value of the property at a time when
the property was owned by the transferee were worked out as if the total of:
(A) the amounts allowed or allowable to the transferor
in respect of depreciation in relation to the property; and
(B) if there have been 2 or more prior successive
applications of this section - the amounts allowed or allowable to the prior successive transferors in respect of depreciation in relation to the property;
were taken to have been amounts allowed or allowable to the transferee in respect of depreciation in relation to the property; and
(e) the Commissioner must not grant leave to the transferee in relation to the property under repealed section 57 of the Principal Act (as that section continues to apply in spite of its repeal by the Taxation Laws Amendment Act (No. 4) 1988).
(Repealed section 57AE: special rules)
(4) If the repealed section 57AE of the Principal Act (which dealt with storage of grain, hay or fodder) (as that section continues to apply in spite of its repeal by the Taxation Laws Amendment Act (No. 4) 1988) applied to the transferor in relation to the property in relation to the year of income in which the time of the disposal occurred, then:
(a) repealed section 57AE has effect, in relation to the transferee and in relation to the property, as if:
(i) (i) the condition set out in repealed paragraph
57AE(1)(d) of the Principal Act that was satisfied in relation to the transferor was satisfied in relation to the transferee; and
(ii) the conditions set out in whichever of repealed
subparagraphs 57AE(2)(a)(i) and (ii) of the Principal Act that were satisfied in relation to the transferor were satisfied in relation to the transferee; and
(b) if the repealed section 57AE of the Principal Act applies to the transferee - the provisions of the Income Tax Assessment Act 1936 relating to depreciation apply as if:
(i) the transferee had acquired the unit of property for a
consideration equal to the cost of the unit to the transferor; and
(ii) depreciation were not allowable to the transferee in
respect of:
(A) so much of the cost of the property as was allowed
or allowable to the transferee in respect of depreciation in relation to the property; or
(B) if there have been 2 or more prior successive

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applications of the roll-over section - so much of the cost of the property as was allowed or allowable to the prior successive transferors in respect of depreciation in relation to the property; and
(iii) the depreciated value of the property at a time when
the property was owned by the transferee were worked out as if the total of:
(A) the amounts allowed or allowable to the transferor
in respect of depreciation in relation to the property; and
(B) if there have been 2 or more prior successive
applications of this section - the amounts allowed or allowable to the prior successive transferors in respect of depreciation in relation to the property;
were taken to have been amounts allowed or allowable to the transferee in respect of depreciation in relation to the property.
(Repealed section 57AH: special rules)
(5) If the repealed section 57AH of the Principal Act (which dealt with primary production) (as that section continues to apply in spite of its repeal by the Taxation Laws Amendment Act (No. 4) 1988) applied to the transferor in relation to the property in relation to the year of income in which the time of the disposal occurred, then:
(a) section 57AH has effect, in relation to the transferee and in relation to the property, as if:
(i) (i) the conditions set out in repealed paragraphs
57AH(1)(c) and (d) of the Principal Act that were satisfied in relation to the transferor were satisfied in relation to the transferee; and
(ii) the conditions set out in whichever of repealed
subparagraphs 57AH(3)(a)(i) and (ii) of the Principal Act that were satisfied in relation to the transferor were satisfied in relation to the transferee; and
(b) if the repealed section 57AH of the Principal Act applies to the transferee - the provisions of the Income Tax Assessment Act 1936 relating to depreciation apply as if:
(i) the transferee had acquired the unit of property for a
consideration equal to the cost of the unit to the transferor; and
(ii) depreciation were not allowable to the transferee in
respect of:
(A) so much of the cost of the property as was allowed
or allowable to the transferee in respect of depreciation in relation to the property; or
(B) if there have been 2 or more prior successive
applications of the roll-over section - so much of the cost of the property as was allowed or allowable to the prior successive transferors in respect of depreciation in relation to the property; and
(iii) the depreciated value of the property at a time when
the property was owned by the transferee were worked out as if the total of:
(A) the amounts allowed or allowable to the transferor
in respect of depreciation in relation to the property; and
(B) if there have been 2 or more prior successive
applications of this section - the amounts allowed or allowable to the prior successive transferors in respect of depreciation in relation to the property;
were taken to have been amounts allowed or allowable to the transferee in respect of depreciation in relation to the property.
(Repealed section 57AL: special rules)
(6) If the repealed section 57AL of the Principal Act (which dealt with 5/3 depreciation) (as that section continues to apply in spite of its repeal by the Taxation Laws Amendment Act (No. 4) 1988) applied to the transferor in relation to the property in relation to the year of income in which the time of the disposal occurred, then:
(a) repealed section 57AL has effect, in relation to the transferee and in relation to the property, as if:
(i) the condition set out in repealed paragraph 57AL(1)(b)
of the Principal Act that was satisfied in relation to the transferor was satisfied in relation to the transferee; and
(ii) repealed subsection 57AL(7) of the Principal Act had
not been enacted; and
(b) if the repealed section 57AL of the Principal Act applies to the transferee in relation to the property - the provisions of the Income Tax Assessment Act 1936 relating to depreciation apply as if:
(i) the transferee had acquired the unit of property for a
consideration equal to the cost of the unit to the transferor; and
(ii) depreciation were not allowable to the transferee in
respect of:
(A) so much of the cost of the property as was allowed
or allowable to the transferee in respect of depreciation in relation to the property (worked out as if section 61 of the Principal Act had not been enacted); or
(B) if there have been 2 or more prior successive
applications of the roll-over section - so much of the cost of the property as was allowed or allowable to the prior successive transferors in respect of depreciation in relation to the property (worked out as if section 61 of the Principal Act had not been enacted); and
(iii) the depreciated value of the property at a time when

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the property was owned by the transferee were worked out as if the total of:
(A) the amounts allowed or allowable to the transferor
in respect of depreciation in relation to the property; and
(B) if there have been 2 or more prior successive
applications of this section - the amounts allowed or allowable to the prior successive transferors in respect of depreciation in relation to the property;
were taken to have been amounts allowed or allowable to the transferee in respect of depreciation in relation to the property.
(Scientific research etc.)
(7) Subsection (4) of the roll-over section has effect, in relation to a year of income earlier than the year of income in which 1 July 1991 occurred, as if:
(a) paragraph (4)(c) were omitted; and
(b) the reference in paragraph (4)(d) of the roll-over section to step 2A in section 55 of the Principal Act as amended by this Act were a reference to subsection 73A(5) of the Principal Act.
(Pre-13 March 1991 property)
(8) For the purposes of subsections 64(5) and (8) of this Act, if the property was pre-13 March 1991 property of the transferor, the property is taken to be pre-13 March 1991 property of the transferee.
(Post-12 March 1991 property)
(9) For the purposes of subsections 64(6) and (9) of this Act, if the property was post-12 March 1991 property of the transferor, the property is taken to be post-12 March 1991 property of the transferee.
(100% depreciation)
(10) If subsection 64(7) of this Act (which deals with pre-1 July 1991 property) applied to the transferor in relation to the property, that subsection applies to the transferee in relation to the property.
(Old depreciation percentage)
(11) For the purposes of the application to the transferee of the provisions of the Income Tax Assessment Act 1936 relating to depreciation, the annual percentage fixed under repealed section 55 of the Principal Act (as that section continues to apply in spite of its repeal by this Act) in relation to the transferee in respect of the property is taken to be equal to the annual percentage fixed under that section in relation to the transferor in respect of the property.
(Record-keeping etc.)
(12) A reference in section 59AA or 262A of the Principal Act as amended by this Act to section 58 of that Act includes a reference to this section.

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 72
Transitional - elective capital deduction roll-over relief where CGT roll-over relief available under section 160ZZO of the Principal Act and property disposed of after 6 December 1990
(Definitions)

72.(1) In this section:
"amended Act" means the Principal Act as amended by this Act;
"roll-over section" means section 58, 73AA, 122JAA, 122JG, 123BBA, 123BF, 124AMAA, 124GA, 124JD or 124PA of the amended Act.
(Extended application of roll-over sections)
(2) If:
(a) a taxpayer (in this section called the "transferor") disposed of property to another taxpayer (in this section called the "transferee"); and
(b) the disposal took place after 6 December 1990 and before 20 December 1991; and
(c) the transferor and the transferee make a joint election that this section apply to the disposal; and
(d) assuming that both the transferor and the transferee had elected under paragraph 160ZZO(1)(d) of the Principal Act that section 160ZZO of the Principal Act apply in respect of the disposal of the property:
(i) section 160ZZO of the Principal Act would have applied
to the disposal of the property; and
(ii) if the disposal had taken place after 19 December
1991, a roll-over section would have applied to the disposal of the property;
then, in addition to the application of the roll-over section concerned apart from this section, the roll-over section applies to the disposal.
(How joint election made)
(3) A joint election under subsection (2) has no effect unless it:
(a) is in writing; and
(b) is made:
(i) within 6 months after the later of the following:
(A) the end of the year of income of the transferee in
which the disposal occurred;
(B) the commencement of this subsection; or
(ii) within such further period as the Commissioner
allows.
(Retention of joint election)
(4) A person who is a party to a joint election under subsection (2) must retain the election, or a copy, until the end of 5 years after the earlier of:
(a) the disposal by the person of the property; or
(b) the loss or destruction of the property.
Penalty: $3,000.
(Exceptions to retention rules)
(5) Subsection (4) does not require a person to retain an election, or a copy, if:
(a) the Commissioner has notified the person that retention of the election or copy is not required; or
(b) the person is a company that has gone into liquidation and has been finally dissolved.
(Extension of roll-over relief to motor vehicles)
(6) For the purposes of this section, in addition to the effect that section 160ZZO of the Principal Act has apart from this subsection, that section also has the effect that it would have if a reference in that section to an asset included a reference to a motor vehicle of a kind mentioned in paragraph 82AF(2)(a) of the Principal Act.

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 73
Transitional - section 160AFE of the Principal Act

73. Subsection 160AFE(1C) of the Principal Act applies, and is taken to have applied, if, and only if, the original year of income referred to in that subsection was the 1990-91 year of income or a subsequent year of income.

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 74
Transitional - Part X record-keeping offences

74. In determining whether a person has committed an offence against Division 11 of Part X of the Principal Act before the commencement of this section, the amendments made by sections 59 to 62 (inclusive) are to be disregarded.

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 75
Amendment of assessments

75. Section 170 of the Principal Act does not prevent the amendment of an assessment made before the commencement of this section for the purpose of giving effect to this Act.

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - PART 4
PART 4 - AMENDMENT OF THE INCOME TAX
(INTERNATIONAL AGREEMENTS) ACT 1953

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 76
Principal Act

76. In this Part, "Principal Act" means the Income Tax (International Agreements) Act 1953.*3*
3. No. 82, 1953, as amended. For previous amendments, see No. 25, 1958; No. 88, 1959; Nos. 19 and 29, 1960; No. 71, 1963; No. 112, 1964; No. 105, 1965; No. 17, 1966; Nos. 39 and 86, 1967; No. 3, 1968; No. 24, 1969; No. 48, 1972; Nos. 11 and 216, 1973; No. 129, 1974; No. 119, 1975; Nos. 52, 55 and 143, 1976; No. 134, 1977; No. 87, 1978; Nos. 23 and 127, 1980; Nos. 28, 110, 143 and 154, 1981; Nos. 51 and 57, 1983; Nos. 123 and 125, 1984; Nos. 168 and 173, 1985; Nos. 49, 51 and 112, 1986; No. 165, 1989; No. 121, 1990; and Nos. 5 and 96, 1991.

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 77
Schedule 32

77. Schedule 32 to the Principal Act is amended by inserting in paragraph (1)(a) of Article 14 "other" before "Contracting State".

TAXATION LAWS AMENDMENT ACT 1992
No. 35, 1992 - SECT 78
Application of amendment

78. The amendment made by this Part applies to assessments in respect of income of:
(a) the first year of income to which the Fijian agreement applied; and
(b) all subsequent years of income.