INCOME TAX ASSESSMENT ACT 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-10 - FINANCIAL TRANSACTIONS  

Division 230 - Taxation of financial arrangements  

Subdivision 230-A - Core rules  

Financial arrangement concept

SECTION 230-50   Financial arrangement (equity interest or right or obligation in relation to equity interest)  

230-50(1)  
You also have a financial arrangement if you have an *equity interest. The equity interest constitutes the financial arrangement.

230-50(2)  
You also have a financial arrangement if:


(a) you have, under an *arrangement:


(i) a legal or equitable right to receive something that is a financial arrangement under this section; or

(ii) a legal or equitable obligation to provide something that is a financial arrangement under this section; or

(iii) a combination of one or more such rights and/or obligations; and


(b) the right, obligation or combination does not constitute, or form part of, a financial arrangement under subsection 230-45(1) .

The right, obligation or combination referred to in paragraph (a) constitutes the financial arrangement.

Note 1:

Paragraph 230-40(4)(e) prevents the accruals method or the realisation method being applied to something that is a financial arrangement under this section.

Note 2:

Subsection 230-270(1) prevents the retranslation method being applied to something that is a financial arrangement under this section.

Note 3:

Subsection 230-330(1) prevents the hedging method being applied to something that is a financial arrangement under this section.


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