Income Tax Assessment Act 1997



Division 112 - Modifications to cost base and reduced cost base  

Subdivision 112-A - General modifications  

SECTION 112-25   Split, changed or merged assets   Split or changed assets

This section sets out what happens if:

(a) a *CGT asset (the original asset ) is split into 2 or more assets (the new assets ); or

(b) a *CGT asset (also the original asset ) changes in whole or in part into an asset (also the new asset ) of a different nature;

and you are the beneficial owner of the original asset and each new asset.


You subdivide a block of land into 3 separate blocks. Each of those blocks is a new asset .

The splitting or change is not a *CGT event.

You work out the *cost base and *reduced cost base of each new asset as follows: Method statement

Step 1.

Work out each element of the *cost base and *reduced cost base of the original asset at the time of the event referred to in subsection (1).

Step 2.

Apportion in a reasonable way each element to each new asset. The result is each corresponding element of the new asset's *cost base and *reduced cost base.

Merged assets

If 2 or more *CGT assets (the original assets ) are merged into a single asset (the new asset ) and you are the beneficial owner of the original assets and the new asset:

(a) the merger is not a *CGT event; and

(b) each element of the *cost base and *reduced cost base of the new asset (at the time of the merging) is the sum of the corresponding elements of each original asset.


Disclaimer and notice of copyright applicable to materials provided by CCH Australia Limited

CCH Australia Limited ("CCH") believes that all information which it has provided in this site is accurate and reliable, but gives no warranty of accuracy or reliability of such information to the reader or any third party. The information provided by CCH is not legal or professional advice. To the extent permitted by law, no responsibility for damages or loss arising in any way out of or in connection with or incidental to any errors or omissions in any information provided is accepted by CCH or by persons involved in the preparation and provision of the information, whether arising from negligence or otherwise, from the use of or results obtained from information supplied by CCH.

The information provided by CCH includes history notes and other value-added features which are subject to CCH copyright. No CCH material may be copied, reproduced, republished, uploaded, posted, transmitted, or distributed in any way, except that you may download one copy for your personal use only, provided you keep intact all copyright and other proprietary notices. In particular, the reproduction of any part of the information for sale or incorporation in any product intended for sale is prohibited without CCH's prior consent.