Income Tax Assessment Act 1997



Division 114 - Indexation of cost base  

SECTION 114-5   When indexation relevant  

Indexation is only relevant if the *cost base of a *CGT asset is relevant to a *CGT event.

Note 1:

The table in section 110-10 sets out the CGT events for which cost base is not relevant.

Note 2:

Indexation is not relevant to the reduced cost base of a CGT asset.

Indexation for some entities only if indexation chosen


Indexation is not relevant to the *capital gain of an entity mentioned in an item of the table from a *CGT event happening after 11.45 am (by legal time in the Australian Capital Territory) on 21 September 1999, unless the relevant entity mentioned in that item has chosen that the *cost base include indexation:

Entities for which indexation is not relevant unless chosen
Item Indexation is not relevant to the capital gain of this entity: Unless this entity has chosen that the cost base include indexation:
1 An individual The individual
2 A *complying superannuation entity The trustee of the complying superannuation entity
3 A trust The trustee of the trust
4 A listed investment company The company


Indexation is not relevant to the *capital gain of a *life insurance company from a *CGT event happening after 30 June 2000 in respect of a *CGT asset that is a *complying superannuation asset unless the company has chosen that the *cost base include indexation.

Section 114-5 of the Income Tax (Transitional Provisions) Act 1997 provides that indexation is not relevant to the capital gain of a life insurance company or registered organisation from a CGT event after 11.45 am on 21 September 1999 and before 1 July 2000 unless the company or organisation chooses it.


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