Income Tax Assessment Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-3 - CAPITAL GAINS AND LOSSES: SPECIAL TOPICS  

Division 122 - Roll-over for the disposal of assets to, or the creation of assets in, a wholly-owned company  

Subdivision 122-A - Disposal or creation of assets by an individual or trustee to a wholly-owned company  

Replacement-asset roll-over if you dispose of a CGT asset

SECTION 122-40   Disposal of a CGT asset  

122-40(1)    
If you choose a roll-over, a *capital gain or *capital loss you make from the trigger event is disregarded.

122-40(2)    
If you *acquired the asset on or after 20 September 1985:

(a) the first element of each *share's *cost base is the asset's cost base when you *disposed of it (less any liabilities the company undertakes to discharge in respect of it) divided by the number of shares; and

(b) the first element of each share's *reduced cost base is worked out similarly.

Note 1:

There are rules for working out what are the liabilities in respect of an asset: see section 122-37 .

Note 2:

There are special indexation rules for roll-overs: see Division 114 .

122-40(3)    
If you *acquired the asset before 20 September 1985, you are taken to have acquired the *shares before that day.