Income Tax Assessment Act 1997
The total of the net forgiven amounts of all your debts forgiven in an income year is applied to reduce 4 classes of amounts that could otherwise reduce your taxable income in the same or a later income year. It is applied in the following order:
You can choose the order in which the net forgiven amounts reduce the amounts within each class.
If all the amounts in the 4 classes are reduced to nil, any remaining net forgiven amounts are disregarded.
|General operative provisions|
|245-100||Subdivision not to apply to calculation of attributable income|
|245-105||How total net forgiven amount is applied|
|Reduction of tax losses|
|245-115||Total net forgiven amount is applied in reduction of tax losses|
|245-120||Allocation of total net forgiven amount in respect of tax losses|
|Reduction of net capital losses|
|245-130||Remaining total net forgiven amount is applied in reduction of net capital losses|
|245-135||Allocation of remaining total net forgiven amount in respect of net capital losses|
|Reduction of expenditure|
|245-145||Remaining total net forgiven amount is applied in reduction of expenditure|
|245-150||Allocation of remaining total net forgiven amount in respect of expenditures|
|245-155||How expenditure is reduced - straight line deductions|
|245-157||How expenditure is reduced - diminishing balance deductions|
|245-160||Amount applied in reduction of expenditure included in assessable income in certain circumstances|
|Reduction of cost bases of assets|
|245-175||Remaining total net forgiven amount is applied in reduction of cost bases of CGT assets|
|245-180||Allocation of remaining total net forgiven amount among relevant cost bases of CGT assets|
|245-185||Relevant cost bases of investments in associated entities are reduced last|
|245-190||Reduction of the relevant cost bases of a CGT asset|
|Unapplied total net forgiven amount|
|245-195||No further consequences if there is any remaining unapplied total net forgiven amount|
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