INCOME TAX ASSESSMENT ACT 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-10 - FINANCIAL TRANSACTIONS  

Division 230 - Taxation of financial arrangements  

Subdivision 230-H - Exceptions  

SECTION 230-460   Various rights and/or obligations  

Rights and/or obligations subject to an exception

230-460(1)  
This Division does not apply to your gains and losses from a *financial arrangement for any income year to the extent that your rights and/or obligations under the arrangement are the subject of an exception under any of the following subsections.

Leasing or property arrangement

230-460(2)  
A right or obligation arising under:


(a) an *arrangement to which Division 242 (about luxury car leases) applies; or


(b) an arrangement to which Division 240 (about arrangements treated as a sale and loan) applies; or


(c) an arrangement that relates to an asset to which Division 250 (about assets put to tax preferred use) applies; or


(d) an arrangement that, in substance or effect, depends on the use of a specific asset that is:


(i) real property; or

(ii) goods or a personal chattel (other than money or a *money equivalent); or

(iii) intellectual property;
and gives a right to control the use of the asset; or


(e) an arrangement that is a licence to use:


(i) real property; or

(ii) goods or a personal chattel (other than money or a money equivalent); or

(iii) intellectual property;

is the subject of an exception.

Interest in partnership or trust

230-460(3)  
A right carried by an interest in a partnership or a trust, or an obligation that corresponds to such a right, is the subject of an exception if:


(a) there is only one class of interest in the partnership or trust; or


(b) the interest is an *equity interest in the partnership or trust; or


(c) for a right or obligation relating to a trust - the trust is managed by a funds manager or custodian, or a responsible entity (as defined in the Corporations Act 2001) of a registered scheme (as so defined).

230-460(4)  


Subsection (3) does not apply if, assuming that the *financial arrangement were a *Division 230 financial arrangement, a *fair value election, or an *election to rely on financial reports, would apply to it. Certain insurance policies

230-460(5)  
A right or obligation under a *life insurance policy is the subject of an exception unless:


(a) you are not a *life insurance company that is the insurer under the policy; and


(b) the policy is an annuity that is a *qualifying security.

230-460(6)  
A right or obligation under a *general insurance policy is the subject of an exception unless:


(a) you are not a *general insurance company; and


(b) the policy is a *derivative financial arrangement. Certain workers' compensation arrangements

230-460(7)  


A right or obligation in relation to a liability for workers' compensation claims to which Subdivision 321-C applies is the subject of an exception. Certain guarantees and indemnities

230-460(8)  
A right or obligation under a guarantee or indemnity is the subject of an exception unless:


(a) assuming that the *financial arrangement were a *Division 230 financial arrangement, it would be the subject of a *fair value election or an *election to rely on financial reports; or


(b) the financial arrangement is a *derivative financial arrangement; or


(c) the guarantee or indemnity is given in relation to a financial arrangement.

Personal arrangements and personal injury

230-460(9)  
The following rights and obligations are the subject of an exception:


(a) a right to receive, or an obligation to provide, consideration for providing personal services;


(b) a right, or obligation, arising from the administration of a deceased person's estate;


(c) a right to receive, or an obligation to provide, a gift under a deed;


(d) a right to receive, or an obligation to provide, a *financial benefit by way of maintenance:


(i) to an individual who is or has been the *spouse of the person liable to provide the benefit; or

(ii) to or for the benefit of an individual who is or has been a child of the person liable to provide the benefit; or

(iii) to or for the benefit of an individual who is or has been a child of an individual who is or has been a spouse of the person liable to provide the benefit;


(e) a right to receive, or an obligation to provide, a financial benefit in relation to personal injury to an individual;


(f) a right to receive, or an obligation to provide, a financial benefit in relation to an injury to an individual's reputation.

230-460(10)  
Without limiting paragraph (9)(e), that paragraph applies:


(a) even if the person to whom the *financial benefit is to be provided is not the individual who was injured; and


(b) even if the personal injury to the individual takes the form of:


(i) a wrong to the individual; or

(ii) illness of the individual.
Superannuation and pension benefits

230-460(11)  
A right to receive, or an obligation to provide, *financial benefits is the subject of an exception if the right or obligation arises from a person's membership of a superannuation or pension scheme, including:


(a) a right of a dependant of a member to receive financial benefits or an obligation to provide financial benefits to a dependant of a member; and


(b) a right or obligation arising from an interest in:


(i) a *complying superannuation fund or *non-complying superannuation fund; or

(ii) a *pooled superannuation trust; or

(iii) an *approved deposit fund; or

(iv) an *RSA.
Interest in controlled foreign companies

230-460(12)  


A right or obligation that arises under a *direct participation interest of an *attributable taxpayer in a *controlled foreign company is the subject of an exception. Proceeds from certain business sales

230-460(13)  


A right to receive, or an obligation to provide, *financial benefits arising from the sale of:


(a) a business; or


(b) shares in a company that operates a business; or


(c) interests in a trust that operates a business;

is the subject of an exception if the amounts, or the values, of those benefits are only *contingent on aspects of the economic performance of the business after the sale.

Infrastructure borrowings

230-460(14)  
A right to receive, or an obligation to provide, *financial benefits is the subject of an exception if the right or obligation arises under an *arrangement to which Division 16L of the Income Tax Assessment Act 1936 applies. Farm management deposits

230-460(15)  


A right to receive, or an obligation to provide, *financial benefits is the subject of an exception if:


(a) the right or obligation is the right or obligation of an *owner of a *farm management deposit; and


(b) the right or obligation relates to the deposit.

Rights and obligations to which section 121EK of the Income Tax Assessment Act 1936 applies

230-460(16)  
A right or obligation that arises because of a payment of an amount to which section 121EK of the Income Tax Assessment Act 1936 applies is the subject of an exception. Forestry managed investment scheme interests

230-460(17)  
A right or obligation under a *forestry interest in a *forestry managed investment scheme in relation to which you can claim deductions under Division 394 is the subject of an exception. Exploration benefits

230-460(17A)  


A right or obligation that arises because of the provision of an *exploration benefit under a *farm-in farm-out arrangement is the subject of an exception. Regulations may provide for exceptions

230-460(18)  
A right or obligation of a kind specified in the regulations for the purposes of this subsection is the subject of an exception.


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