Income Tax Assessment Act 1997
CHAPTER 3
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SPECIALIST LIABILITY RULES
PART 3-1
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CAPITAL GAINS AND LOSSES: GENERAL TOPICS
CGT event E3 happens if:
(a) a trust (that is not a unit trust) over a *CGT asset is converted to a unit trust; and
(b) just before the conversion, a beneficiary under the trust was absolutely entitled to the asset as against the trustee (disregarding any legal disability the beneficiary is under). 104-65(2)
The time of the event is when the trust is converted. 104-65(3)
The beneficiary makes a capital gain if the *market value of the asset (when the trust is converted) is more than the asset's *cost base. The beneficiary makes a capital loss if that market value is less than the asset's *reduced cost base.
A *capital gain or *capital loss the beneficiary makes is disregarded if it *acquired the asset before 20 September 1985.
Division 104
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CGT events
Subdivision 104-E
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Trusts
SECTION 104-65
Converting a trust to a unit trust: CGT event E3
104-65(1)
CGT event E3 happens if:
(a) a trust (that is not a unit trust) over a *CGT asset is converted to a unit trust; and
(b) just before the conversion, a beneficiary under the trust was absolutely entitled to the asset as against the trustee (disregarding any legal disability the beneficiary is under). 104-65(2)
The time of the event is when the trust is converted. 104-65(3)
The beneficiary makes a capital gain if the *market value of the asset (when the trust is converted) is more than the asset's *cost base. The beneficiary makes a capital loss if that market value is less than the asset's *reduced cost base.
Exception
104-65(4)
A *capital gain or *capital loss the beneficiary makes is disregarded if it *acquired the asset before 20 September 1985.
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