Income Tax Assessment Act 1936

Div 3 heading inserted by No 172 of 1978.

S 73BM repealed by No 93 of 2011, s 3 and Sch 3 item 44, effective 8 September 2011. For application, savings and transitional provisions see note under s 82KZLB . S 73BM formerly read:

SECTION 73BM BALANCING ADJUSTMENTS: SECTION 73BH PLANT  
73BM(1)
If:

(a) a balancing adjustment event (within the meaning of subsection 42-30(3) of the Income Tax Assessment Act 1997 ) happens in relation to a unit of section 73BH plant of an eligible company; and

(b) one or more deductions have been allowed or are allowable to the eligible company under section 73BH for the unit for a year or years of income; and

(c) no deduction was allowable to the eligible company under section 42-15 of the Income Tax Assessment Act 1997 for the unit for any year of income; and

(d) a deduction would be allowable to the eligible company, or an amount would be included in the eligible company's assessable income, in respect of the balancing adjustment event under Subdivision 42-F of that Act as so in force, if:

(i) the changes set out in section 73BJ were made; and

(ii) section 42-220A of the Income Tax Assessment Act 1997 and this section (other than this paragraph) had not been enacted;

then the deduction mentioned in paragraph (d) is allowable to the eligible company, or the amount mentioned in paragraph (d) is included in the eligible company's assessable income, under this section for the year of income in which the balancing adjustment event occurs.

Note:

If deductions have been allowable under both section 73BH of this Act and section 42-15 of the Income Tax Assessment Act 1997 for a unit of section 73BH plant, the balancing adjustment provisions of Division 42 of that Act apply in a modified way: see section 42-220A of that Act.

73BM(2) Increase in deduction or assessable amount where section 73BH deductions allowable at 1.25 rate.  

However, if at least one of the deductions mentioned in paragraph (1)(b) was worked out by multiplying a notional Division 42 deduction by 1.25, subsection (3) applies.

73BM(3)
Any amount (the eligible subsection (1) amount ):

(a) allowable as a deduction to the eligible company under subsection (1) of this section for the unit of section 73BH plant; or

(b) included in the assessable income of the eligible company under subsection (1) of this section for the unit of section 73BH plant, where that amount is so included as a result of the application of section 42-190 of the Income Tax Assessment Act 1997 in accordance with paragraph (1)(d) of this section;

is increased by the amount worked out using the formula:

Sum of all 1.25 rate notional Division 42       deductions       Total decline in value

×

Eligible subsection (1) amount

×

0.25

where:

sum of all 1.25 rate notional Division 42 deductions
means the sum of all notional Division 42 deductions that were multiplied by 1.25 in working out the deductions mentioned in paragraph (1)(b) for the unit of section 73BH plant.

total decline in value
means the cost of the unit of section 73BH plant, less its undeducted cost, just before the balancing adjustment event, where that cost and undeducted cost are the amounts taken into account in applying Subdivision 42-F of the Income Tax Assessment Act 1997 in accordance with paragraph (1)(d) for the purpose of working out the deduction allowable to the eligible company, or the amount included in the eligible company's assessable income, under subsection (1) for the unit.

73BM(4) Assessability of amounts received in respect of results etc. of research and development activities.  

Subject to subsections (5) and (6), if:

(a) an eligible company has incurred any expenditure in respect of which:

(i) a deduction under section 73BH has been allowed or is allowable to the company; or

(ii) in the case of a company whose income was exempt from tax when the expenditure was incurred - a deduction under section 73BH would have been allowable if the company's income had not been so exempt from tax; and

(b) the eligible company receives or is entitled to receive:

(i) an amount in respect of the results of any of the research and development activities in relation to which the expenditure was incurred; or

(ii) an amount attributable to the company having incurred the expenditure, including an amount that it is entitled to receive irrespective of the results of the activities;

that amount is included in the company's assessable income of the year of income in which the company received or became entitled to receive it.

73BM(5)
The reference in subsection (4) to a company receiving or being entitled to receive an amount in respect of the results of any research and development activities includes a reference to:

(a) the company receiving or being entitled to receive an amount from the grant of access to, or the grant of a right to use, any of those results; and

(b) the company receiving or being entitled to receive an amount from the disposal of, or of an interest in, any section 73BH plant or from the grant of a right to use any section 73BH plant where, as a result of the disposal or grant, another person has acquired a right of access to, or a right to use, any of those results;

but does not include a reference to the company receiving or being entitled to receive an amount in consequence of the use by the company of any of those results.

73BM(6)
If a company receives or is entitled to receive an amount as mentioned in paragraph (5)(b), the amount to be included in the company's assessable income under subsection (4) is only so much (if any) of the amount mentioned in that paragraph as exceeds the cost to the company of acquiring or constructing the section 73BH plant concerned.

73BM(7) Definitions.  

In this section:

eligible company
has the same meaning as in section 73B .

notional Division 42 deduction
has the meaning given by section 73BJ .

research and development activities
has the same meaning as in section 73B .

section 73BH plant
has the meaning given by section 73BI .

S 73BM inserted by No 170 of 2001.