Draft Taxation Determination

TD 93/D74

Income tax: does a disposal of livestock because of the loss of pasture or fodder as a result of drought qualify for the concessions in subsection 36(3) or section 36AAA of the Income Tax Assessment Act 1936 even though the sale takes place after the drought declaration is withdrawn for the area in which the livestock or pasture was located?

• Please note that the PDF version is the authorised version of this draft ruling.
  This document has been finalised by TD 95/6.

FOI status:

draft only - for comment

Preamble

1. Yes. Subsection 36(3) and section 36AAA provide concessions to a taxpayer where, in consequence of the loss or destruction of pastures or fodder by reason of drought, the taxpayer disposes of livestock that is an asset of a business of primary production. The fact that the disposal takes place after the withdrawal of the official drought declaration for the area does not change the fact that the disposal is a result of the loss of pasture or fodder. Consequently, providing that the other requirements of the legislation are satisfied, the taxpayer would be entitled to the concessions available under subsection 36(3) or section 36AAA.

2. It is a question of fact whether the disposal is a consequence of the loss of pasture or fodder by reason of drought. The taxpayer bears the onus of proving that the disposal of livestock was caused by the loss of the pasture or fodder.

Commissioner of Taxation
18 March 1993

References

BO D/92/0025/Par

Subject References:
Forced disposal
livestock
drought

Legislative References:
ITAA 36(3)
ITAA 36AAA