Income Tax Assessment Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

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

Division 132 - Leases  

SECTION 132-10   Grant of a long-term lease  

132-10(1)    
These rules apply if *CGT event F2 happens for a lessor of property.

132-10(2)    
For any later *CGT event that happens to the land or the lessor ' s lease of it, its *cost base and *reduced cost base (including the cost base and reduced cost base of any building, part of a building, structure or improvement that is treated as a separate *CGT asset) excludes:

(a) any expenditure incurred before *CGT event F2 happens; and

(b) the *cost of any *depreciating asset for which the lessor has deducted or can deduct an amount for the asset ' s decline in value under this Act.

Note:

Subdivision 108-D sets out when a building, structure or improvement is treated as a separate CGT asset.

132-10(3)    

The fourth element of the property ' s *cost base and *reduced cost base includes any payment by the lessor to the lessee to vary or waive a term of the lease or for the forfeiture or surrender of the lease, reduced by the amount of any *input tax credit to which the lessor is entitled for the variation or waiver.

132-10(4)    
The expenditure or payment can include giving property: see section 103-5 .