Document ID: chunk:federal_register_of_legislation:C2025C00014:clause:2d_8:p3
Version: federal_register_of_legislation:C2025C00014
Segment Type: clause
Provision Reference: sch 2D cl 8 (pt 3/4)
Character Range: 2207937–2210699

as it applies to balancing adjustments for plant or depreciating assets, do not apply in respect of an asset to which Subdivision 58‑B of the Income Tax Assessment Act 1997 applies.
 (2) Despite subsection (1), Subdivision 57‑J applies for the purposes of section 40‑35 of the Income Tax (Transitional Provisions) Act 1997 to capital expenditure incurred by a transition taxpayer before 1 July 2001 that relates to property that is not a depreciating asset.

Subdivision 57‑P—Balancing adjustment on ceasing to have a Division 230 financial arrangement

57‑135  Balancing adjustment on ceasing to have a Division 230 financial arrangement referred to in section 57‑32
 (1) This section applies if:
 (a) section 57‑32 was applied to work out the market value of an asset (the subject asset); and
 (b) the transition taxpayer is a party to the Division 230 financial arrangement (the financial arrangement) to which the subject asset, or the corresponding liability for the subject asset, is or is part of; and
 (c) a balancing adjustment is made under Subdivision 230‑G of the Income Tax Assessment Act 1997, after the transition time, in relation to the financial arrangement.
 (2) For the purposes of making the balancing adjustment under Subdivision 230‑G of the Income Tax Assessment Act 1997 in relation to the financial arrangement, adjust the amount worked out using the method statement (the method statement) in subsection 230‑445(1) of that Act by:
 (a) if the transition taxpayer is the holder of the subject asset—increasing any gain or reducing any loss by the amount worked out under subsection (4) of this section; or
 (b) if the transition taxpayer is the holder of the corresponding liability for the subject asset—reducing any gain or increasing any loss by the amount worked out under subsection (4) of this section.
 (3) Despite subsection (2):
 (a) if the amount worked out under subsection (4) exceeds the amount of the loss to be reduced under paragraph (2)(a)—the transition taxpayer is taken, for the purposes of making the balancing adjustment, to have made a gain equal to the amount of the excess; or
 (b) if the amount worked out under subsection (4) exceeds the amount of the gain to be reduced under paragraph (2)(b)—the transition taxpayer is taken, for the purposes of making the balancing adjustment, to have made a loss equal to the amount of the excess; or
 (c) if when applying the method statement no balancing adjustment is made in relation to the financial arrangement—the transition taxpayer is taken, for the purposes of making the balancing adjustment, to have:
 (i) if the transition taxpayer is the holder of the subject asset—made a gain equal to the amount worked out under subsection (4); or
 (ii) if the transition