INCOME TAX (TRANSITIONAL PROVISIONS) ACT 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-45 - RULES FOR PARTICULAR INDUSTRIES AND OCCUPATIONS  

Division 328 - Small business entities  

SECTION 328-112   Working out whether you are a small business entity for certain small business concessions - entities connected with you  

328-112(1)  
For the purpose of working out whether you are a small business entity for the 2007-08, 2008-09, 2009-10 or 2010-11 income year (each a relevant income year ) for the purposes of a provision to which subsection (3) applies:


(a) subsection 328-125(4) of the Income Tax Assessment Act 1997 does not apply; and


(b) the following subsection applies instead.

328-112(2)  
An entity (the first entity ) controls a discretionary trust for a relevant income year if, for any of the 4 income years (a previous income year ) before that year:


(a) if the previous income year is before the 2007-08 income year - the trustee of the trust made a distribution of $100,000 or more to the first entity, any of its affiliates, or the first entity and any of its affiliates; or


(b) if the previous income year is the 2007-08 income year or a later income year:


(i) the trustee of the trust paid to, or applied for the benefit of, the first entity, any of the first entity ' s affiliates, or the first entity and any of its affiliates, any of the income or capital of the trust; and

(ii) the percentage (the control percentage ) of the income or capital paid or applied is at least 40% of the total amount of income or capital paid or applied by the trustee for that year.

328-112(3)  
This subsection applies to the following provisions:


(a) Subdivisions 328-D of the Income Tax Assessment Act 1997 (simpler rules for depreciating assets);


(b) Subdivision 328-E of the Income Tax Assessment Act 1997 (simplified trading stock rules);


(c) (Repealed by No 23 of 2012)


(d) sections 82KZM and 82KZMD of the Income Tax Assessment Act 1936 (deducting certain prepaid expenses immediately);


(e) section 170 of the Income Tax Assessment Act 1936 (standard 2-year period for amending assessments).




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