Income Tax Assessment Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-10 - FINANCIAL TRANSACTIONS  

Division 245 - Forgiveness of commercial debts  

Subdivision 245-D - Calculation of net forgiven amount of a debt  

Operative provisions

SECTION 245-85   Reduction of gross forgiven amount  

245-85(1)  
The *gross forgiven amount of your debt is reduced by the sum of the following amounts:

(a) any amount that, under a provision of this Act other than this Division, has been, or will be, included in your assessable income for any income year as a result of the *forgiveness of the debt;

(b) any amount by which, under a provision of this Act other than this Division, an amount you could otherwise have deducted for any income year has been, or will be, reduced as a result of the forgiveness of the debt (except a reduction under Division 727 (about indirect value shifting));

(c) any amount by which the *cost base of any of your *CGT assets has been, or will be, reduced under Part 3-1 or 3-3 as a result of the forgiveness of the debt.

Note:

Paragraph (1)(c) does not cover a reduction under Division 727 (indirect value shifting) because that Division is not in Part 3-1 or 3-3.

245-85(2)  
Subject to section 245-90 , the amount remaining after reducing the *gross forgiven amount under subsection (1) is the net forgiven amount of the debt.