Income Tax Assessment Act 1997
CGT event E5 happens if a beneficiary becomes absolutely entitled to a *CGT asset of a trust (except a unit trust or a trust to which Division 128 applies) as against the trustee (disregarding any legal disability the beneficiary is under).
Division 128 deals with the effect of death.104-75(2)
The time of the event is when the beneficiary becomes absolutely entitled to the asset. Trustee makes a capital gain or loss 104-75(3)
The trustee makes a capital gain if the *market value of the asset (at the time of the event) is more than its *cost base. The trustee makes a capital loss if that market value is less than the asset ' s *reduced cost base. Exception for trustee 104-75(4)
A *capital gain or *capital loss the trustee makes is disregarded if it *acquired the asset before 20 September 1985.
There is also an exception for employee share trusts: see section 130-80 .
The beneficiary makes a capital gain if the *market value of the asset (at the time of the event) is more than the *cost base of the beneficiary ' s interest in the trust capital to the extent it relates to the asset.
The beneficiary makes a capital loss if that market value is less than the *reduced cost base of that beneficiary ' s interest in the trust capital to the extent it relates to the asset.Exceptions for beneficiary 104-75(6)
A *capital gain or *capital loss the beneficiary makes is disregarded if:
(a) the beneficiary *acquired the *CGT asset that is the interest (except by way of an assignment from another entity) for no expenditure; or
(b) the beneficiary acquired it before 20 September 1985; or
(c) all or part of the capital gain or capital loss the trustee makes from the *CGT event is disregarded under Subdivision 118-B (about main residence).
Expenditure can include giving property: see section 103-5 .
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