Income Tax Assessment Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-95 - VALUE SHIFTING  

Division 725 - Direct value shifting affecting interests in companies and trusts  

Subdivision 725-A - Scope of the direct value shifting rules  

SECTION 725-45   Main object  

725-45(1)  
The main object of this Division is:


(a) to prevent inappropriate losses from arising on the realisation of * equity or loan interests from which value has been shifted to other equity or loan interests in the same entity; and


(b) to prevent inappropriate gains from arising on the realisation of equity or loan interests in the same entity to which the value has been shifted;

so far as those interests are owned by entities involved in the value shift.

725-45(2)  
This is done by:


(a) adjusting the value of those interests for income tax purposes to take account of changes in *market value that are attributable to the value shift; and


(b) treating the value shift as a partial realisation to the extent that value is shifted:


(i) between interests held by different owners; or

(ii) in the case of interests in their character as CGT assets - from post-CGT assets to pre-CGT assets; or

(iii) between interests of different characters.

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