Document ID: chunk:federal_register_of_legislation:C2025C00014:section:26aj:p2
Version: federal_register_of_legislation:C2025C00014
Segment Type: section
Provision Reference: s 26AJ (pt 2/6)
Character Range: 224935–227541

Assessment Act 1986, would be a fringe benefit;
then:
 (h) if subparagraph (a)(i) applies—the taxpayer's assessable income of the current year of income includes the amount (if any) by which the benchmark amount of interest in relation to the loan in respect of the current year of income exceeds the amount of interest that has accrued on the loan in respect of the current year of income; or
 (i) if subparagraph (a)(ii) applies—the taxpayer's assessable income of the current year of income includes the amount paid or credited; or
 (j) if subparagraph (a)(iii) applies—the taxpayer's assessable income of the current year of income includes the arm's length value of the property or services, reduced by the recipient's contribution (if any).
 (2) If:
 (a) apart from this subsection, an amount (in this subsection called the gross assessable amount) is included in a taxpayer's assessable income of a year of income under paragraph (1) (h) in respect of a loan benefit; and
 (b) assuming that:
 (i) the recipient of the loan benefit had, on the last day of the period (in this subsection called the loan period) during the year of income when the recipient was under an obligation to repay the whole or any part of the loan, incurred and paid unreimbursed interest (in this subsection called the gross interest), in respect of the loan, in respect of the loan period; and
 (ii) the amount of the gross interest was equal to the benchmark amount of interest in relation to the loan in respect of the year of income;
  a once‑only deduction (in this subsection called the gross deduction) would, or would apart from Subdivisions F and GA of Division 3 of this Part, and Divisions 28 and 900 of the Income Tax Assessment Act 1997, have been allowable to the recipient in respect of the gross interest;
the gross assessable amount is reduced by:
 (c) if no interest accrued on the loan in respect of the loan period—the amount of the gross deduction; or
 (d) in any other case—the amount worked out using the formula:

  where:
  Gross deduction means the amount of the gross deduction.
  Reducing amount means the amount (if any) that would, or that would apart from Subdivisions F and GA of Division 3 of this Part, and Divisions 28 and 900 of the Income Tax Assessment Act 1997, have been allowable as a once‑only deduction to the recipient in respect of the interest that accrued on the loan in respect of the loan period if that interest had been incurred and paid by the recipient on the last day of the loan period.
 (3) If:
 (a) apart from this subsection, an amount (in this subsection called the