Product Ruling PR 2018/14
Date of effect: 1 July 2018

What this ruling is about: 1. This Product Ruling sets out the Commissioner's opinion on the way in which the relevant provisions identified in the Ruling section apply to the defined class of entities who take part in the scheme to which this Ruling relates. All legislative references in this Ruling are to the Income Tax Assessment Act 1997 (ITAA 1997) unless otherwise indicated. 2. In this Product Ruling the scheme is referred to as the Tailored Portfolio Collar Facility (the Facility) offered by Macquarie Bank Limited (the Bank) and issued under the Product Disclosure Statement referred to in paragraph 15 of this Product Ruling (the PDS). 3. This Product Ruling does not address: Class of entities 4. This part of the Product Ruling specifies which entities can rely on the Ruling section of this Product Ruling and which entities cannot rely on the Ruling section. Those entities that can rely on the Ruling section are referred to in this Product Ruling as the Investor. 5. The class of entities that can rely on the Ruling section of this Product Ruling consists of those entities that: 6. The class of entities that can rely on the Ruling section of this Product Ruling does not include entities that: Qualifications 7. The class of entities defined in this Product Ruling may rely on its contents provided the scheme actually carried out is carried out in accordance with the scheme described in paragraphs 15 to 19 in this Product Ruling. 8. If the scheme actually carried out is materially different from the scheme that is described in this Product Ruling, then:

Class of entities or scheme: 4. This part of the Product Ruling specifies which entities can rely on the Ruling section of this Product Ruling and which entities cannot rely on the Ruling section. Those entities that can rely on the Ruling section are referred to in this Product Ruling as the Investor. 5. The class of entities that can rely on the Ruling section of this Product Ruling consists of those entities that: 6. The class of entities that can rely on the Ruling section of this Product Ruling does not include entities that: | Qualifications: 7. The class of entities defined in this Product Ruling may rely on its contents provided the scheme actually carried out is carried out in accordance with the scheme described in paragraphs 15 to 19 in this Product Ruling. 8. If the scheme actually carried out is materially different from the scheme that is described in this Product Ruling, then: 9. This Product Ruling applies from 1 July 2018. It therefore applies only to the specified class of entities that enter into the scheme from 1 July 2018 until 30 June 2021, being its period of application. This Product Ruling will continue to apply to those entities even after its period of application has ended for the scheme entered into during the period of application. 10. However the Product Ruling only applies to the extent that there is no change in the scheme or in the entity's involvement in the scheme. | Changes in the law: 11. Although this Product Ruling deals with the income tax laws enacted at the time it was issued, later amendments may impact on this Product Ruling. Any such changes will take precedence over the application of this Product Ruling and, to that extent; this Product Ruling will have no effect. 12. Entities who are considering participating in the scheme are advised to confirm with their taxation adviser that changes in the law have not affected this Product Ruling since it was issued. | Note to promoters and advisers: 13. Product Rulings were introduced for the purpose of providing certainty about tax consequences for entities in schemes such as this. In keeping with that intention the Commissioner suggests that promoters and advisers ensure that participants are fully informed of any legislative changes after the Product Ruling has issued. 14. Subject to paragraph 3 of this Product Ruling and the assumptions in paragraph 19 of this Ruling: 15. The scheme that is the subject of this Product Ruling is identified and described in the following documents: Note: certain information has been provided on a commercial-in-confidence basis and will not be disclosed or released under Freedom of Information legislation. 16. For the purposes of describing the scheme to which this Product Ruling applies, there are no other agreements, whether formal or informal, and whether or not legally enforceable, which an Investor, or any associate of an Investor, will be a party to, which are a part of the scheme. Capitalised terms in this Product Ruling take their meaning from the PDS and/or the Terms and Conditions referred to in paragraph 15 of this Product Ruling. 17. All Australian Securities and Investments Commission (ASIC) requirements are, or will be, complied with for the term of the agreements. | Overview: 18. The details of the Facility are summarised as follows: | Assumptions: 19. This Product Ruling is made on the basis of the following necessary assumptions: Commissioner of Taxation 12 December 2018 | Section 8-1 and Division 247 - capital protected borrowings and deductibility of interest: 20. Interest paid on a borrowing used to acquire income producing assets such as a Reference Asset is generally deductible under section 8-1 where it is expected that dividends or other assessable income would be derived from the investment (see Taxation Ruling TR 95/33 Income tax: subsection 51(1) - relevance of subjective purpose, motive or intention in determining the deductibility of losses and outgoings ). However, the ability to claim interest deductions may be subject to Division 247. 21. Division 247 limits the allowable deductions for expenditure incurred under a 'capital protected borrowing'. Broadly, a capital protected borrowing arises where an amount is borrowed under an arrangement where the borrower is protected against the fall in value of some specified securities, and where that borrowing is made for the purpose of investing in those securities. 22. Division 247 applies to the Linked Loan where the Investor uses the Linked Loan to acquire the Reference Assets and the Investor is protected against the fall in the market value of those Reference Assets. 23. Division 247 sets out a methodology for reasonably attributing a cost to the capital protection obtained by a borrower under a capital protected borrowing. Division 247 ignores any amount which is not in substance for capital protection or interest in calculating the cost of capital protection, pursuant to subsection 247-20(3). 24. Where an Investor acquires an Option and procures a Linked Loan: 25. Where an Investor has acquired a Portfolio and the Bank has applied a single Interest Rate to the Linked Loan, the investment will be treated as one arrangement for the purposes of Division 247. 26. There is no element of capital protection connected with the Interest Assistance Loan. No part of the interest incurred by an Investor on an Interest Assistance Loan for the income year will therefore be attributable to the cost of capital protection and the interest on the Interest Assistance Loan will be deductible under section 8-1. | Section 51AAA: 27. By acquiring the Reference Assets, it is contemplated that an Investor will derive assessable income by way of the receipt of dividends and/or trust distributions and capital gains. As interest incurred on any Linked Loan and Interest Assistance Loan would have been deductible under section 8-1 notwithstanding the inclusion of a net capital gain in assessable income, section 51AAA of the ITAA 1936 has no application to an Investor who enters into the Facility. | Section 82KL: 28. The operation of section 82KL of the ITAA 1936 depends on, among other things, the identification of a certain quantum of 'additional benefit(s)'. Insufficient 'additional benefits' will be provided to trigger the application of section 82KL of the ITAA 1936. It will not apply to deny the deductions otherwise allowable under section 8-1 of the ITAA 1997. | Subdivision H of Division 3 of Part III: 29. Subdivision H of Division 3 of Part III of the ITAA 1936 (Subdivision H) deals with the timing of deductions for certain advance expenditure incurred under an agreement in return for the doing of a thing under that agreement that will not be wholly done within the same year of income. Separate rules apply depending on whether the expenditure is incurred in carrying on a business, whether the Investor is a small business entity, whether the Investor is an individual and whether the Investor is not an individual and incurs the expenditure otherwise than in carrying on a business. This Subdivision does not apply to 'excluded expenditure' which is defined in subsection 82KZL(1) of the ITAA 1936 to include amounts of less than $1,000 or amounts that are of a capital nature. | Subdivision 328-C - small business entities for the purposes of Subdivision H: 30. Under section 328-110, an Investor carrying on a business in an income year will be a small business entity for that year (the current year) if: | The eligible service period for the purposes of Subdivision H: 31. The interest charged on a Linked Loan that is deductible under section 8-1 of the ITAA 1997 is in relation to a prepayment of loan interest for a period that is 12 months or less. Paragraph 82KZL(2)(a) of the ITAA 1936 provides that a payment of interest that is made in return for the making available of a loan principal is to be taken, for the purposes of Subdivision H, to be expenditure incurred under an agreement in return for the doing of a thing under the agreement for the period to which the interest payment relates. The eligible service period in relation to a payment of loan interest is determined by reference to the period to which the interest relates and not to the period of the loan. | Sections 82KZME and 82KZMF - prepaid expenditure and 'tax shelter' style arrangements: 32. The rules in sections 82KZME and 82KZMF of the ITAA 1936 apply, subject to the exceptions in section 82KZME, where expenditure is incurred in relation to a 'tax shelter' style arrangement for the doing of a thing that is not to be wholly done within the expenditure year. 33. For the purposes of section 82KZME of the ITAA 1936, 'agreements' are broadly defined to include an entire arrangement of which a contract may form part. Under subsection 82KZME(4) of the ITAA 1936, the relevant 'agreement' is all the contractual arrangements and activities associated with the participation in the Facility, including the financing, share and/or unit purchase, share and/or unit holding and disposal arrangements. 34. Exception 1, as contained in subsection 82KZME(5) of the ITAA 1936, applies to exclude the interest allowable as a deduction under section 8-1 of the ITAA 1997 on borrowings under a Linked Loan from the operation of section 82KZMF of the ITAA 1936 as: 35. Deductibility of the prepaid interest must therefore be considered under the prepayment rules outlined in paragraphs 36 to 41 of this Product Ruling. | Section 82KZM - prepaid expenditure incurred by certain small business entities and individuals incurring non-business expenditure: 36. Section 82KZM of the ITAA 1936 operates to spread over more than one income year a deduction for prepaid expenditure incurred by a taxpayer that is either: 37. Section 82KZM of the ITAA 1936 applies if: 38. As the eligible service period in relation to the deductible interest under the Linked Loan is not more than 12 months and does not end after the last day of the year of income after the one in which the expenditure was incurred, section 82KZM of the ITAA 1936 will have no application to Investors that are a small business entity that have not chosen to apply section 82KZMD of the ITAA 1936 to the expenditure, or to Investors who are individuals and the expenditure is not incurred in carrying on a business. Investors that satisfy these tests will be able to claim an immediate deduction allowable under section 8-1 of the ITAA 1997 for interest incurred under the Linked Loan. | Sections 82KZMA and 82KZMD - prepaid non-business expenditure incurred by non-individual and non-small business entities: 39. Sections 82KZMA and 82KZMD of the ITAA 1936 set the amount and timing of deductions for expenditure for an Investor (other than a small business entity for the year of income that has not chosen to apply section 82KZMD to the expenditure) that is not an individual and does not incur the expenditure in carrying on a business. 40. The expenditure must not be excluded expenditure and must be incurred in return for the doing of a thing under an agreement that is not to be wholly done within the expenditure year. 41. For these Investors, the amount of prepaid interest incurred under the Linked Loan which is allowable as a deduction under section 8-1 will be apportioned over the relevant Interest Period. | Parts 3-1 and 3-3 - application of CGT provisions to the Option and the Reference Assets: 42. If an Investor's Option is exercised under a Sell Instruction, the Investor will dispose of their Reference Assets and CGT event A1 will arise for the Investor in respect of the disposal: section 104-10. Under item 2 of the table in subsection 134-1(1), the Investor's cost base and reduced cost base of the Reference Assets will include any Fixed Premium paid and the additional amount (if any) calculated under paragraph 14(a)(ii) of this Product Ruling. Any capital gain or capital loss on exercise of the Option will be disregarded: subsection 134-1(4). 43. If an Investor's Option is exercised under a Cash Settlement Request, CGT event C2 will arise for the Investor in respect of the exercise of the Option: section 104-25. The cost base and reduced cost base of the Option will include any Fixed Premium paid and the additional amount (if any) calculated under paragraph 14(a)(ii) of this Product Ruling: sections 110-25 and 110-55. No CGT event will occur in relation to the Reference Assets. 44. Where an Investor's Option is unexercised and expires, CGT event C2 will arise for the Investor in relation to the Option at that time: section 104-25. Where the Investor will not receive any capital proceeds in respect of the expiry of the Option (that is, where the circumstances contemplated by paragraph 18(s) of this Product Ruling are not applicable), a capital loss will be made by the Investor in this regard, equal to the Investor's reduced cost base in the Option. Under section 110-55, the reduced cost base of the Option will include any Fixed Premium and (where applicable) Variable Premium paid, and the additional amount (if any) calculated under paragraph 14(a)(ii) of this Product Ruling. 45. Under section 110-25 and 110-55 respectively, an Investor's cost base and reduced cost base in the Reference Assets acquired by the Investor under the Facility will include the amount of any Linked Loan used to finance the acquisition of the Reference Assets and incidental costs incurred by the Investor in acquiring and disposing of the Reference Assets (this includes stamp duty and costs of transfer). As per paragraph 42 of this Product Ruling, where the Investor's Option is exercised under a Sell Instruction, the Investor's cost base and reduced cost base in the Reference Assets also includes the cost base or reduced cost base of the Option. 46. Division 115 allows a taxpayer a discount on capital gains in certain circumstances. In accordance with section 115-5, any capital gain realised by an Investor on the sale of the Reference Assets, exercise of an Option under a Cash Settlement Request or expiry of an Option in circumstances contemplated by paragraph 18(s) of this Product Ruling will be treated as a discount capital gain where the Investor is an individual or a trust and has held the Reference Assets or Option for more than 12 months (excluding the days of acquisition and disposal). | Division 230 - taxation of financial arrangements: 47. Division 230 of the ITAA 1997 sets out the tax treatment of gains or losses from a 'financial arrangement'. Where an arrangement is not a qualifying security for the purposes of Division 16E of the ITAA 1936 and an election under section 230-455 of the ITAA 1997 to have Division 230 apply to financial arrangements has not been made, then pursuant to section 230-455, Division 230 does not apply in relation to gains or losses from a financial arrangement held by: | Part IVA - anti-avoidance: 48. Provided that the scheme ruled on is entered into and carried out in the manner described in this Product Ruling, it is accepted that the scheme is an ordinary commercial transaction and that Part IVA of the ITAA 1936 will not apply. 49. The following is a detailed contents list for this Ruling: © AUSTRALIAN TAXATION OFFICE FOR THE COMMONWEALTH OF AUSTRALIA You are free to copy, adapt, modify, transmit and distribute this material as you wish (but not in any way that suggests the ATO or the Commonwealth endorses you or any of your services or products). Not previously issued as a draft

Ruling: This Product Ruling has been given on the basis that the entity(s) that applied for the Product Ruling, and their associates, will abide by strict terms of use. Any failure to comply with the terms of use may lead to the withdrawal of this Product Ruling. 1. This Product Ruling sets out the Commissioner's opinion on the way in which the relevant provisions identified in the Ruling section apply to the defined class of entities who take part in the scheme to which this Ruling relates. All legislative references in this Ruling are to the Income Tax Assessment Act 1997 (ITAA 1997) unless otherwise indicated. 2. In this Product Ruling the scheme is referred to as the Tailored Portfolio Collar Facility (the Facility) offered by Macquarie Bank Limited (the Bank) and issued under the Product Disclosure Statement referred to in paragraph 15 of this Product Ruling (the PDS). 3. This Product Ruling does not address: | Class of entities: 4. This part of the Product Ruling specifies which entities can rely on the Ruling section of this Product Ruling and which entities cannot rely on the Ruling section. Those entities that can rely on the Ruling section are referred to in this Product Ruling as the Investor. 5. The class of entities that can rely on the Ruling section of this Product Ruling consists of those entities that: 6. The class of entities that can rely on the Ruling section of this Product Ruling does not include entities that: | Qualifications: 7. The class of entities defined in this Product Ruling may rely on its contents provided the scheme actually carried out is carried out in accordance with the scheme described in paragraphs 15 to 19 in this Product Ruling. 8. If the scheme actually carried out is materially different from the scheme that is described in this Product Ruling, then:


Appendix: Section 8-1 and Division 247 - capital protected borrowings and deductibility of interest: 20. Interest paid on a borrowing used to acquire income producing assets such as a Reference Asset is generally deductible under section 8-1 where it is expected that dividends or other assessable income would be derived from the investment (see Taxation Ruling TR 95/33 Income tax: subsection 51(1) - relevance of subjective purpose, motive or intention in determining the deductibility of losses and outgoings ). However, the ability to claim interest deductions may be subject to Division 247. 21. Division 247 limits the allowable deductions for expenditure incurred under a 'capital protected borrowing'. Broadly, a capital protected borrowing arises where an amount is borrowed under an arrangement where the borrower is protected against the fall in value of some specified securities, and where that borrowing is made for the purpose of investing in those securities. 22. Division 247 applies to the Linked Loan where the Investor uses the Linked Loan to acquire the Reference Assets and the Investor is protected against the fall in the market value of those Reference Assets. 23. Division 247 sets out a methodology for reasonably attributing a cost to the capital protection obtained by a borrower under a capital protected borrowing. Division 247 ignores any amount which is not in substance for capital protection or interest in calculating the cost of capital protection, pursuant to subsection 247-20(3). 24. Where an Investor acquires an Option and procures a Linked Loan: 25. Where an Investor has acquired a Portfolio and the Bank has applied a single Interest Rate to the Linked Loan, the investment will be treated as one arrangement for the purposes of Division 247. 26. There is no element of capital protection connected with the Interest Assistance Loan. No part of the interest incurred by an Investor on an Interest Assistance Loan for the income year will therefore be attributable to the cost of capital protection and the interest on the Interest Assistance Loan will be deductible under section 8-1. | Section 51AAA: 27. By acquiring the Reference Assets, it is contemplated that an Investor will derive assessable income by way of the receipt of dividends and/or trust distributions and capital gains. As interest incurred on any Linked Loan and Interest Assistance Loan would have been deductible under section 8-1 notwithstanding the inclusion of a net capital gain in assessable income, section 51AAA of the ITAA 1936 has no application to an Investor who enters into the Facility. | Section 82KL: 28. The operation of section 82KL of the ITAA 1936 depends on, among other things, the identification of a certain quantum of 'additional benefit(s)'. Insufficient 'additional benefits' will be provided to trigger the application of section 82KL of the ITAA 1936. It will not apply to deny the deductions otherwise allowable under section 8-1 of the ITAA 1997. | Subdivision H of Division 3 of Part III: 29. Subdivision H of Division 3 of Part III of the ITAA 1936 (Subdivision H) deals with the timing of deductions for certain advance expenditure incurred under an agreement in return for the doing of a thing under that agreement that will not be wholly done within the same year of income. Separate rules apply depending on whether the expenditure is incurred in carrying on a business, whether the Investor is a small business entity, whether the Investor is an individual and whether the Investor is not an individual and incurs the expenditure otherwise than in carrying on a business. This Subdivision does not apply to 'excluded expenditure' which is defined in subsection 82KZL(1) of the ITAA 1936 to include amounts of less than $1,000 or amounts that are of a capital nature. | Subdivision 328-C - small business entities for the purposes of Subdivision H: 30. Under section 328-110, an Investor carrying on a business in an income year will be a small business entity for that year (the current year) if: | The eligible service period for the purposes of Subdivision H: 31. The interest charged on a Linked Loan that is deductible under section 8-1 of the ITAA 1997 is in relation to a prepayment of loan interest for a period that is 12 months or less. Paragraph 82KZL(2)(a) of the ITAA 1936 provides that a payment of interest that is made in return for the making available of a loan principal is to be taken, for the purposes of Subdivision H, to be expenditure incurred under an agreement in return for the doing of a thing under the agreement for the period to which the interest payment relates. The eligible service period in relation to a payment of loan interest is determined by reference to the period to which the interest relates and not to the period of the loan. | Sections 82KZME and 82KZMF - prepaid expenditure and 'tax shelter' style arrangements: 32. The rules in sections 82KZME and 82KZMF of the ITAA 1936 apply, subject to the exceptions in section 82KZME, where expenditure is incurred in relation to a 'tax shelter' style arrangement for the doing of a thing that is not to be wholly done within the expenditure year. 33. For the purposes of section 82KZME of the ITAA 1936, 'agreements' are broadly defined to include an entire arrangement of which a contract may form part. Under subsection 82KZME(4) of the ITAA 1936, the relevant 'agreement' is all the contractual arrangements and activities associated with the participation in the Facility, including the financing, share and/or unit purchase, share and/or unit holding and disposal arrangements. 34. Exception 1, as contained in subsection 82KZME(5) of the ITAA 1936, applies to exclude the interest allowable as a deduction under section 8-1 of the ITAA 1997 on borrowings under a Linked Loan from the operation of section 82KZMF of the ITAA 1936 as: 35. Deductibility of the prepaid interest must therefore be considered under the prepayment rules outlined in paragraphs 36 to 41 of this Product Ruling. | Section 82KZM - prepaid expenditure incurred by certain small business entities and individuals incurring non-business expenditure: 36. Section 82KZM of the ITAA 1936 operates to spread over more than one income year a deduction for prepaid expenditure incurred by a taxpayer that is either: 37. Section 82KZM of the ITAA 1936 applies if: 38. As the eligible service period in relation to the deductible interest under the Linked Loan is not more than 12 months and does not end after the last day of the year of income after the one in which the expenditure was incurred, section 82KZM of the ITAA 1936 will have no application to Investors that are a small business entity that have not chosen to apply section 82KZMD of the ITAA 1936 to the expenditure, or to Investors who are individuals and the expenditure is not incurred in carrying on a business. Investors that satisfy these tests will be able to claim an immediate deduction allowable under section 8-1 of the ITAA 1997 for interest incurred under the Linked Loan. | Sections 82KZMA and 82KZMD - prepaid non-business expenditure incurred by non-individual and non-small business entities: 39. Sections 82KZMA and 82KZMD of the ITAA 1936 set the amount and timing of deductions for expenditure for an Investor (other than a small business entity for the year of income that has not chosen to apply section 82KZMD to the expenditure) that is not an individual and does not incur the expenditure in carrying on a business. 40. The expenditure must not be excluded expenditure and must be incurred in return for the doing of a thing under an agreement that is not to be wholly done within the expenditure year. 41. For these Investors, the amount of prepaid interest incurred under the Linked Loan which is allowable as a deduction under section 8-1 will be apportioned over the relevant Interest Period. | Parts 3-1 and 3-3 - application of CGT provisions to the Option and the Reference Assets: 42. If an Investor's Option is exercised under a Sell Instruction, the Investor will dispose of their Reference Assets and CGT event A1 will arise for the Investor in respect of the disposal: section 104-10. Under item 2 of the table in subsection 134-1(1), the Investor's cost base and reduced cost base of the Reference Assets will include any Fixed Premium paid and the additional amount (if any) calculated under paragraph 14(a)(ii) of this Product Ruling. Any capital gain or capital loss on exercise of the Option will be disregarded: subsection 134-1(4). 43. If an Investor's Option is exercised under a Cash Settlement Request, CGT event C2 will arise for the Investor in respect of the exercise of the Option: section 104-25. The cost base and reduced cost base of the Option will include any Fixed Premium paid and the additional amount (if any) calculated under paragraph 14(a)(ii) of this Product Ruling: sections 110-25 and 110-55. No CGT event will occur in relation to the Reference Assets. 44. Where an Investor's Option is unexercised and expires, CGT event C2 will arise for the Investor in relation to the Option at that time: section 104-25. Where the Investor will not receive any capital proceeds in respect of the expiry of the Option (that is, where the circumstances contemplated by paragraph 18(s) of this Product Ruling are not applicable), a capital loss will be made by the Investor in this regard, equal to the Investor's reduced cost base in the Option. Under section 110-55, the reduced cost base of the Option will include any Fixed Premium and (where applicable) Variable Premium paid, and the additional amount (if any) calculated under paragraph 14(a)(ii) of this Product Ruling. 45. Under section 110-25 and 110-55 respectively, an Investor's cost base and reduced cost base in the Reference Assets acquired by the Investor under the Facility will include the amount of any Linked Loan used to finance the acquisition of the Reference Assets and incidental costs incurred by the Investor in acquiring and disposing of the Reference Assets (this includes stamp duty and costs of transfer). As per paragraph 42 of this Product Ruling, where the Investor's Option is exercised under a Sell Instruction, the Investor's cost base and reduced cost base in the Reference Assets also includes the cost base or reduced cost base of the Option. 46. Division 115 allows a taxpayer a discount on capital gains in certain circumstances. In accordance with section 115-5, any capital gain realised by an Investor on the sale of the Reference Assets, exercise of an Option under a Cash Settlement Request or expiry of an Option in circumstances contemplated by paragraph 18(s) of this Product Ruling will be treated as a discount capital gain where the Investor is an individual or a trust and has held the Reference Assets or Option for more than 12 months (excluding the days of acquisition and disposal). | Division 230 - taxation of financial arrangements: 47. Division 230 of the ITAA 1997 sets out the tax treatment of gains or losses from a 'financial arrangement'. Where an arrangement is not a qualifying security for the purposes of Division 16E of the ITAA 1936 and an election under section 230-455 of the ITAA 1997 to have Division 230 apply to financial arrangements has not been made, then pursuant to section 230-455, Division 230 does not apply in relation to gains or losses from a financial arrangement held by: | Part IVA - anti-avoidance: 48. Provided that the scheme ruled on is entered into and carried out in the manner described in this Product Ruling, it is accepted that the scheme is an ordinary commercial transaction and that Part IVA of the ITAA 1936 will not apply.


What this Ruling is about | NOT LEGALLY BINDING SECTION: | A public ruling is an expression of the Commissioner's opinion about the way in which a relevant provision applies, or would apply, to entities generally or to a class of entities in relation to a particular scheme or a class of schemes. | If you rely on this ruling, the Commissioner must apply the law to you in the way set out in the ruling (unless the Commissioner is satisfied that the ruling is incorrect and disadvantages you, in which case the law may be applied to you in a way that is more favourable for you - provided the Commissioner is not prevented from doing so by a time limit imposed by the law). You will be protected from having to pay any underpaid tax, penalty or interest in respect of the matters covered by this ruling if it turns out that it does not correctly state how the relevant provision applies to you. | Potential participants must form their own view about the commercial and financial viability of the product. The Commissioner recommends a financial (or other) adviser be consulted for such information. | This Product Ruling provides certainty for potential participants by confirming that the tax benefits set out in the Ruling part of this document are available, provided that the scheme is carried out in accordance with the information we have been given, and have described below in the Scheme part of this document. If the scheme is not carried out as described, participants lose the protection of this Product Ruling. | Sections 82KZM - prepaid expenditure incurred by certain small business entities and individuals incurring non-business expenditure | Parts 3-1 and 3-3 - application of CGT provisions to the Option and Reference Assets | Appendix 2 - Detailed contents list


Related rulings: TR 95/33
Legislative references: ITAA 1936 ITAA 1936 51AAA ITAA 1936 Pt III Div 3 Subdiv H ITAA 1936 82KL ITAA 1936 82KZL(1) ITAA 1936 82KZL(2)(a) ITAA 1936 82KZM ITAA 1936 82KZMA ITAA 1936 82KZMD ITAA 1936 82KZME ITAA 1936 82KZME(4) ITAA 1936 82KZME(5) ITAA 1936 82KZME(5)(b)(ii) ITAA 1936 82KZME(5)(b)(iii) ITAA 1936 82KZMF ITAA 1936 Div 16E ITAA 1936 Pt IVA ITAA 1997 ITAA 1997 8-1 ITAA 1997 Subdiv 83A-B ITAA 1997 Subdiv 83A-C ITAA 1997 Pt 3-1 ITAA 1997 104-10 ITAA 1997 104-25 ITAA 1997 104-25(1)(c) ITAA 1997 104-25(1)(e) ITAA 1997 104-25(3) ITAA 1997 109-5 ITAA 1997 110-25 ITAA 1997 110-55 ITAA 1997 Div 115 ITAA 1997 115-5 ITAA 1997 Pt 3-3 ITAA 1997 134-1(1) ITAA 1997 134-1(4) ITAA 1997 Div 230 ITAA 1997 230-455 ITAA 1997 230-455(7) ITAA 1997 Div 247 ITAA 1997 247-20(3) ITAA 1997 247-20(4) ITAA 1997 247-20(5) ITAA 1997 247-20(6) ITAA 1997 Subdiv 328-C ITAA 1997 328-110 ITAA 1997 328-110(1) TAA 1953 Corporations Act 2001 Corporations Act 2001 9 Corporations Act 2001 601EB