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Edited version of private advice
Authorisation Number: 1012640497396
Ruling
Subject: Application of section 855-10 of the Income Tax Assessment Act 1997
Question 1
Will any capital gain made by Company A on disposal of its units in the X Trust be disregarded under section 855-10 of the Income Tax Assessment Act 1997?
Answer
Yes.
Question 2
If question 1 is answered positively, does Part IVA of the Income Tax Assessment Act 1936 apply in respect of the non-inclusion in Company A's assessable income of any capital gain in respect of the disposal of its units in the X Trust?
Answer
No.
This ruling applies for the following periods:
Year ended 30 June 2014
The scheme commences on:
Year ended 30 December 2012
Relevant facts and circumstances
1. Company A held units in an Australian resident trust, which it has disposed of.
2. Company A is a non-resident of Australia for income tax purposes.
3. Company A does not have a permanent establishment in Australia.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 855-10
Income Tax Assessment Act 1936 Part IVA
Reasons for decision
Question 1:
Company A meets the criteria for the application of section 855-10 of the Income Tax Assessment Act 1997. That is, the Non-Taxable Australian Real Property assets held in the Trust exceed the Taxable Australian Real Property held in the Trust.
Question 2:
On the facts of this case it is considered that Part IVA of the Income Tax Assessment Act 1936 does not apply.