Document ID: chunk:federal_register_of_legislation:C2004C00958:clause:2_311
Version: federal_register_of_legislation:C2004C00958
Segment Type: clause
Provision Reference: sch 2 cl 311
Character Range: 847221–848529

311  Exercise of rights

 (1) Despite section 130‑40 of the Income Tax Assessment Act 1997, the modifications in subsections (3) and (4) of this section apply if a taxpayer exercises rights or options as mentioned in that section to acquire:

 (a) shares in a company, or options to acquire shares in a company; or

 (b) units in a unit trust, or options to acquire units in a unit trust;

and those rights or options are 30 June 1988 assets of the taxpayer.

 (2) The first element of the cost base of the shares, units or options is the sum of:

 (a) the amount paid to exercise the rights or options; and

 (b) the greater of the market value of the rights or options (at the end of 30 June 1988) and the cost base of the rights or options (on that day).

 (3) The first element of the reduced cost base of the shares, units or options is the sum of:

 (a) the amount paid to exercise the rights or options; and

 (b) the lesser of the market value of the rights or options (at the end of 30 June 1988) and the cost base of the rights or options (on that day).

 (4) The payment referred to in subsection (3) or (4) can include giving property: see subsection 303(3).

 (5) For indexation purposes, the amount referred to in paragraph (3)(b) is taken to have been incurred on 30 June 1988.