Document ID: chunk:federal_register_of_legislation:C2025C00029:section:3:p45
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 3 (pt 45/79)
Character Range: 4951906–4954636

base and *reduced cost base of a *CGT asset is the amount worked out using the formula in subsection (2) if:
 (a) the asset is a CGT asset (a demutualisation asset) covered by section 316‑110; and
 (b) the asset is issued to an entity covered by section 316‑115.
 (2) The formula is:

Time of acquisition
 (3) The entity is taken to have *acquired the *CGT asset at the time it is issued.

316‑110  Demutualisation assets
 (1) This section covers a *CGT asset that:
 (a) is:
 (i) a *share in the *friendly society; or
 (ii) a right to *acquire a share in the friendly society; or
 (iii) a share in an entity that owns all of the shares in the friendly society; or
 (iv) a right to acquire a share in an entity mentioned in subparagraph (iii); and
 (b) is issued under the demutualisation; and
 (c) is issued in connection with:
 (i) the variation or abrogation of rights attaching to or consisting of an interest affected by demutualisation (see paragraph 316‑55(1)(b)); or
 (ii) the conversion, cancellation, extinguishment or redemption of an interest affected by demutualisation.

Exclusion for rights with an exercise price
 (2) Despite subsection (1), this section does not cover a right to *acquire a *share in an entity if the holder of the right must pay an amount to exercise the right.

Exclusion where assets not issued simultaneously
 (3) Despite subsection (1), a *CGT asset is not covered by this section unless all of the CGT assets covered by subsection (1) for the demutualisation are issued:
 (a) at the same time; and
 (b) to entities that are covered by section 316‑115.

316‑115  Entities to which section 316‑105 applies
 (1) This section covers an entity that:
 (a) either:
 (i) is or has been a *member of the *friendly society; or
 (ii) is or has been insured through the friendly society or a health/life insurance subsidiary of the friendly society; and
 (b) is entitled under the demutualisation to an allocation of demutualisation assets.
 (2) This section also covers an entity that has become entitled to an allocation of demutualisation assets because of the death of an individual who was an entity described in subsection (1).
 (3) This section also covers the trustee of a lost policy holders trust (see section 316‑155).

Subdivision 316‑D—Lost policy holders trust

Guide to Subdivision 316‑D

316‑150  What this Subdivision is about
      If the demutualisation creates a trust just to hold shares, rights to acquire shares or money for entities that were members of the friendly society or insured through the society or its subsidiary, or are successors of such entities, then:

                (a) capital gains or losses from CGT events happening to beneficiaries' interests in the trust