Document ID: chunk:federal_register_of_legislation:C2015A00130:clause:1_1:p3
Version: federal_register_of_legislation:C2015A00130
Segment Type: clause
Provision Reference: sch 1 cl 1 (pt 3/3)
Character Range: 9342–11207

one such right under the arrangement, apportion the adjustment amount between the costs, or cost bases and reduced cost bases, of those rights on a reasonable basis.
Note: Subsections 40‑77(1D) and (1E) of the Income Tax (Transitional Provisions) Act 1997 set out when this Division does not apply to the right.

Tax effects of the right to an interest realignment adjustment
 (3) In calculating the *termination value of a *mining, quarrying or prospecting right that you provide under an *interest realignment arrangement, assume to be zero the *market value of any contractual right conferred by the arrangement to an *interest realignment adjustment to be received by you.
 (4) In calculating the *cost of a *mining, quarrying or prospecting right that you receive under an *interest realignment arrangement, assume to be zero the *market value of any contractual right conferred by the arrangement to an *interest realignment adjustment to be provided by you.
 (5) The creation of a right to an *interest realignment adjustment does not cause *CGT event D1 or CGT event D3 to happen.
 (6) Your receipt of an *interest realignment adjustment does not cause *CGT event C2 to happen in relation to the right to receive the adjustment.

Meaning of interest realignment adjustment
 (7) An interest realignment adjustment is an amount, or an asset (other than a *mining, quarrying or prospecting right), that:
 (a) is provided under an *interest realignment arrangement to a party to the arrangement by or on behalf of another party to the arrangement; and
 (b) is provided as an adjustment, to the parties' contributions of value to the project to which the arrangement relates, that arises because information that has become available since the time the arrangement took effect indicates that the other party did not make an appropriate contribution at that time.