Commonwealth Consolidated Acts

INCOME TAX ASSESSMENT ACT 1997 - SECT 385.135

  (1)   If your assessable income for an income year would otherwise include the * proceeds of the sale of 2 wool clips because fire, drought or flood causes you to shear your sheep earlier than normal, you can elect to include in your assessable income for the next income year the * profit on the sale of the earlier than normal wool clip.

For rules about the making and effect of an election, see Subdivision   385 - H.

  (2)   However, at the time the wool was shorn, the sheep must have been assets of a * primary production business you carried on in Australia. Also, the fire, drought or flood must have been in an area of Australia where you carried on that business at that time.

  (3)   The proceeds of the sale of 2 wool clips are:

  (a)   the proceeds of the sale of the earlier than normal wool clip; and

  (b)   an amount covered by one or more of the following:

  (i)   proceeds of the sale of another wool clip in the income year;

  (ii)   proceeds of the sale of wool shorn in the previous income year that you hold at the start of the income year and that you took into account at cost in working out the * value of your * trading stock under Division   60 at the end of the previous income year;

  (iii)   an amount for wool shorn in the previous income year that is included in your assessable income of the income year because of a previous election under this section.

  (4)   The profit on the sale of the earlier than normal wool clip is the proceeds of the sale of the wool clip that would otherwise be included in your assessable income for the income year, less the expenses you incur in the income year that are directly attributable to the earlier shearing and sale.

Table of sections

385 - 145   Partnerships and trusts

385 - 150   Time for making election

385 - 155   Amounts are assessable income from carrying on the primary production business

385 - 160   Effect of certain events on election

385 - 163   Disentitling events

385 - 165   New partnership can elect to be treated as same entity as old partnership

385 - 170   New partnership can elect to take advantage of election made by former owner of the business