INCOME TAX (TRANSITIONAL PROVISIONS) ACT 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-30 - SUPERANNUATION  

Division 294 - Transfer balance cap  

Subdivision 294-B - CGT relief  

SECTION 294-130   Pooled superannuation trusts using proportionate or alternative exemption method - disregard initial capital gain but recognise deferred notional gain  

Application

294-130(1)  
This section applies in relation to a CGT asset of a pooled superannuation trust if:


(a) section 294-125 applies in relation to the CGT asset; and


(b) as a result of paragraph 294-125(3)(a) , the trust makes a capital gain in respect of the asset (disregarding this section); and


(c) the trustee of the trust makes a choice for the purposes of this paragraph in respect of the asset in accordance with subsection (2).

294-130(2)  
A choice made for the purposes of paragraph (1)(c):


(a) is to be in the approved form; and


(b) can only be made on or before the day by which the trustee of the trust is required to lodge the trust ' s income tax return for the 2016-17 income year; and


(c) cannot be revoked. Disregard initial capital gain

294-130(3)  
Disregard the capital gain mentioned in paragraph (1)(b). Recognition of deferred notional gain

294-130(4)  
The deferred notional gain is the 2016-17 non-exempt proportion of the amount of the trust ' s net capital gain for the 2016-17 income year determined on the assumptions that:


(a) subsection (3) of this section does not apply; and


(b) the trust made no capital gains in that income year other than the gain mentioned in paragraph (1)(b); and


(c) the trust made no capital losses in that income year; and


(d) the trust had no previously unapplied net capital losses from earlier income years.

294-130(5)  
For the purposes of Division 102 of the Income Tax Assessment Act 1997 , if a realisation event happens to the asset in an income year that starts on or after 1 July 2017:


(a) treat the trust as having made a capital gain in that income year equal to the deferred notional gain; and


(b) disregard section 102-20 of that Act in respect of that capital gain; and


(c) treat that capital gain as not being a discount capital gain.

294-130(6)  
Section 295-400 of the Income Tax Assessment Act 1997 does not apply to the amount by which a net capital gain is increased (or comes into existence) as a result of subsection (5).

294-130(7)  
In this section:

2016-17 non-exempt proportion
means:


(a) unless paragraph (b) applies - 1 minus the proportion mentioned in subsection 295-400(1) of the Income Tax Assessment Act 1997; or


(b) if the trustee has made a choice under subsection 295-400(3) of that Act - the percentage worked out by subtracting the percentage mentioned in subsection 295-400(4) of that Act in respect of the trust for the 2016-17 income year from 100%.

deferred notional gain
has the meaning given by subsection (4).




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