Income tax: capital gains: will subsection 160M(7) of the Income Tax Assessment Act 1936 apply where there is an act, transaction or event in relation to an asset and no consideration is received or receivable by reason of that act, transaction or event?
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FOI status:may be releasedFOI number: 1216770
Notice of Withdrawal
1. Subsection 160M(7) of the Income Tax Assessment Act 1936 (ITAA 1936) operated to deem a taxpayer to have disposed of an asset if they received, or were entitled to receive an amount of money or other consideration as a result of an act or transaction taking place in relation to an actual asset that they owned.
2. Taxation Determination TD 93/238 clarified that where no consideration was received the deemed market value consideration rule in subsection 160ZD(2) of the ITAA 1936 did not apply for the purposes of subsection 160M(7) because it was a condition precedent to the operation of that provision that consideration be received.
Commissioner of Taxation
7 July 2004
NO M6/M7 PROJ (CGTDET88)
capital gains tax