Document ID: chunk:federal_register_of_legislation:C2004C01257:clause:2_1:p9
Version: federal_register_of_legislation:C2004C01257
Segment Type: clause
Provision Reference: sch 2 cl 1 (pt 9/20)
Character Range: 30196–33014

been so included if the notional seller had been subject to tax on assessable income;
the *notional buyer is entitled to deduct a corresponding amount in the notional buyer's income year.

 (2) If:
 (a) the *notional seller is entitled to deduct an amount for an income year under subsection 240‑105(3); or
 (b) the notional seller would have been so entitled if the *notional seller had been subject to tax on assessable income;
a corresponding amount is included in the notional buyer's assessable income for the notional buyer's income year.

 (3) The *notional buyer is entitled to a deduction, and is required to include an amount in his or her assessable income only to the extent (if any) that the notional buyer would, apart from this Division, have been entitled to deduct *arrangement payments if no part of those payments were capital in nature.

Subdivision H—Application of Division 16E to certain arrangements

240‑112  Division 16E applies to certain arrangements

 (1) Division 16E of Part III of the Income Tax Assessment Act 1936 applies in relation to an arrangement (the assignment arrangement) between the notional seller and another person (the holder) to transfer the right to payments (the Division 240 payments) under an arrangement that is treated as a sale and loan by this Division (the sale and loan arrangement).

 (2) In applying Division 16E, the following assumptions are to be made:
 (a) the assignment arrangement is the qualifying security;
 (b) the notional seller is the issuer;
 (c) the qualifying security is issued when the assignment arrangement is entered into;
 (d) the issue price is consideration provided to the notional seller under the assignment arrangement;
 (e) the Division 240 payments are payments made by the notional seller under the assignment arrangement;
 (f) no part of the payments represent periodic interest.

 (3) This Subdivision does not apply if the assignment arrangement gives rise to a termination of the sale and loan arrangement for the purposes of this Division.

 (4) To avoid doubt, Division 6A of Part III of the Income Tax Assessment Act 1936 does not apply to an assignment arrangement to which this Subdivision applies.

Subdivision 240‑I—Provisions applying to hire purchase agreements

Table of sections

Operative provisions

240‑115 Another person, or no person taken to own property in certain cases

Operative provisions

240‑115  Another person, or no person taken to own property in certain cases

 (1) This section sets out special modifications of the effect of this Division that apply in relation to a *hire purchase agreement unless:
 (a) the notional buyer would have been the owner or the *quasi‑owner of the property if the *arrangement had been a sale of the property; and
 (b) it is reasonably likely that the right,