Commonwealth Consolidated Acts

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INCOME TAX ASSESSMENT ACT 1997 - SECT 122.140

What if the company undertakes to discharge a liability (disposal case)

Disposal of a CGT asset

  (1)   One of these requirements must be satisfied (for each partner) if:

  (a)   the partners * dispose of their interests in a * CGT asset; and

  (b)   the company undertakes to discharge one or more liabilities in respect of the interests in the asset.

    (The * market value, or the * cost base, of an interest is worked out at the time of the disposal.)

 

What amount the liabilities cannot exceed

Item

In this situation:

the liabilities cannot exceed:

1

A partner * acquired the interest on or after 20   September 1985

The * cost base of the interest

2

A partner * acquired the interest before 20   September 1985

The * market value of the interest

Note:   There are rules for working out what are the liabilities in respect of an interest in an asset: see section   122 - 145.

Disposal of all the assets of a business

  (2)   One of these requirements must be satisfied (for each partner) if:

  (a)   the partners * dispose of their interests in all the assets of a * business; and

  (b)   the company undertakes to discharge one or more liabilities in respect of the interests in the assets.

    (The * market value, or the * cost base, of an interest is worked out at the time of the disposal.)

 

What amount the liabilities cannot exceed

Item

In this situation:

the liabilities cannot exceed:

1

A partner * acquired all the interests on or after 20   September 1985

The sum of the * market values of the partner's interests in * precluded assets and the * cost bases of the partner's interests in other assets

2

A partner * acquired all the interests before 20   September 1985

The sum of the * market values of the interests

3

A partner * acquired at least one interest on or after 20   September 1985 and at least one before that day

For liabilities in respect of interests * acquired on or after that day--the sum of the * market values of the partner's interests in * precluded assets and the * cost bases of the partner's interests in other assets

For liabilities in respect of interests * acquired before that day--the sum of the market values of those interests



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