Document ID: chunk:federal_register_of_legislation:C2014C00710:clause:6_112
Version: federal_register_of_legislation:C2014C00710
Segment Type: clause
Provision Reference: sch 6 cl 112
Character Range: 82502–83853

112  At the end of section 152‑70
Add:

Discretionary trusts
 (4) Subsections (5) and (6) apply for the purpose of working out the *direct small business participation percentage in an entity in connection with a *CGT event that happened in an income year (the CGT event year), if:
 (a) the entity is a trust (where entities do not have entitlements to all the income and capital of the trust); and
 (b) during the relevant year mentioned in item 3 of the table in subsection (1) (disregarding subsection (5)), the trustee mentioned in that item:
 (i) does not make a distribution of income; and
 (ii) does not make a distribution of capital.
 (5) Treat the references in that item to the relevant year as being references to:
 (a) if the trustee made a distribution of income or capital during the CGT event year—the CGT event year; or
 (b) otherwise—the last income year before the CGT event year in which the trustee did make a distribution of income or capital.
 (6) Despite subsection (5), an entity holds a direct small business participation percentage of 0% in the trust at the relevant time if either:
 (a) the trust:
 (i) had a *net income for the relevant year; and
 (ii) did not have a *tax loss for the relevant year; or
 (b) the trustee did not make a distribution of income or capital at any time before the end of the CGT event year.