Document ID: chunk:federal_register_of_legislation:C2025C00014:schedule:2d:p3
Version: federal_register_of_legislation:C2025C00014
Segment Type: schedule
Provision Reference: sch 2D (pt 3/4)
Character Range: 2165272–2167968

time; and
 (b) a CGT event that happens after the transition time in relation to an asset owned by the transition taxpayer;
where the transition taxpayer owned the asset at all times from the transition time until the disposal or the CGT event.

Deemed disposal and re‑purchase
 (2) Subject to subsection (5), in determining for the purposes of this Act (other than the excluded provisions mentioned in subsection (4)) whether an amount is included in, or allowable as a deduction from, the assessable income of the transition taxpayer in respect of the disposal, the transition taxpayer is taken:
 (a) to have sold, immediately before the transition time, each of its assets; and
 (b) to have purchased each of its assets again at the transition time for consideration equal to the asset's adjusted market value at the transition time.
 (2A) For the purposes of Parts 3‑1 and 3‑3 of the Income Tax Assessment Act 1997 (about CGT), in determining whether the transition taxpayer makes a capital gain or capital loss from a CGT event that happens after the transition time in relation to an asset referred to in subsection (1), the cost base and reduced cost base of the asset (at the transition time) is its adjusted market value at that time.
 (3) An asset's adjusted market value at the transition time is the asset's market value at that time:
 (a) reduced by any amount of income received or receivable by the transition taxpayer in respect of the asset at or after the transition time that:
 (i) because of subsection 57‑15(2); or
 (ii) because all of the income of the transition taxpayer was wholly exempt from income tax before the transition time;
  is not included in the transition taxpayer's assessable income; and
 (b) increased by any amount of income received or receivable by the transition taxpayer in respect of the asset before the transition time that:
 (i) because of subsection 57‑15(1); or
 (ii) because the transition taxpayer's income ceased to be exempt from income tax at the transition time;
  is included in the transition taxpayer's assessable income.
Note: If the asset is, or is part of, a Division 230 financial arrangement, section 57‑32 may affect how the market value of the asset is worked out.

Excluded provisions
 (4) For the purposes of subsection (2), the excluded provisions are:
 (e) former Division 10B of Part III of this Act (about industrial property); and
 (f) former Division 10BA of Part III of this Act (about Australian films); and
 (ga) Division 40 of the Income Tax Assessment Act 1997 (about capital allowances); and
 (i) Division 43 of the Income Tax Assessment Act 1997 (about deductions for capital works); and
 (j) section 70‑120 of the