Document ID: chunk:federal_register_of_legislation:C2004C00958:clause:1_10:p1
Version: federal_register_of_legislation:C2004C00958
Segment Type: clause
Provision Reference: sch 1 cl 10 (pt 1/4)
Character Range: 632541–635515

10                                                     the balancing adjustment is required because of item 4 or 5 (about partial changes of ownership) in the table in subsection 373‑60(2)                                         the item's market value at the time of the *balancing adjustment event

Note: If Case 10 applies and the parties jointly elect for roll‑over relief under subsection 373‑85(2), a balancing adjustment is not required.

 (2) The termination value is reduced if:

 (a) the *balancing adjustment event is a disposal of the item; and

 (b) some or all of what you receive for the disposal is *ordinary income.

It is reduced by the amount of ordinary income.

373‑75  Meaning of written down value

  The item's written down value is your *unrecouped expenditure on the item immediately before the *balancing adjustment event.

Subdivision 373‑E—Application of the Common rules

Table of sections

373‑80 Application of Common rules in Division 41
373‑85 Common rule 1 (roll‑over relief for related entities)

373‑80  Application of Common rules in Division 41

  These Common rules apply to your *expenditure on an item of *intellectual property:

 (a) Common rule 1 (roll‑over relief for related entities), but with the qualifications and modifications set out in section 373‑85;

 (b) Common rule 2 (non‑arm's length transactions), but only if that expenditure is worked out using Case 1 in the table in subsection 373‑30(2).

Note 1: Non‑arm's length transactions are also dealt with in section 373‑100.

Note 2: If you have owned the item since before the 1998‑99 income year: see subsection 373‑10(4) of the Income Tax (Transitional Provisions) Act 1997.

373‑85  Common rule 1 (roll‑over relief for related entities)

Application of Common rule 1

 (1) Common rule 1 does not apply to a *partial realisation, or to a transmission by operation of law.

 (2) Roll‑over relief is also available if:

 (a) a *balancing adjustment event happens that is covered by item 4 or 5 (about partial changes of ownership) in the table in subsection 373‑60(2); and

 (b) the owner or owners of the item immediately before the change (the transferor) and the owner or owners of the item immediately after the change (the transferee) jointly elect for roll‑over relief.

Note: For the conditions relating to the election: see section 41‑55.

Modifications of Common rule 1

 (3) Disregard subsection 41‑40(3) (about the transferee being taken to have incurred the transferor's expenditure).

Note: This is because the transferee's expenditure on the item is dealt with in the table in subsection 373‑30(2) and is based on the transferor's unrecouped expenditure immediately before the roll‑over event.

 (4) Instead, the balancing adjustment is affected in this way:

 (a) the total of each amount (if any) that section 373‑50 has included in the transferor's assessable income for an income year (because of a *partial realisation