Income Tax Assessment Act 1936

SCHEDULE 2F - TRUST LOSSES AND OTHER DEDUCTIONS  

Division 266 - Income tax consequences for fixed trusts of abnormal trading or change in ownership  

Subdivision 266-D - Effect of abnormal trading on listed widely held trust  

SECTION 266-110   LISTED WIDELY HELD TRUST MAY BE DENIED TAX LOSS DEDUCTION  

Type of trust to which this section applies

266-110(1)    
This section applies to a trust that:

(a) can in the income year deduct a tax loss from a loss year; and

(b) was a listed widely held trust at all times in the period (the test period ) from the beginning of the loss year until the end of the income year; and

(c) was not an excepted trust at all times in the test period.

To find out the meaning of listed widely held trust : see section 272-115 .

To find out the meaning of excepted trust : see section 272-100 .

Condition for deducting tax loss

266-110(2)    
The trust cannot deduct the tax loss unless it meets either:

• the condition in subsection 266-125(1) ; or

• the condition in subsection 266-125(2) .

Additional restriction on deducting tax loss

266-110(3)    
Even if it meets either of the conditions, it still cannot deduct the tax loss, or part of the tax loss, if section 266-135 (which deals with certain debt deductions) prevents it from doing so.