Document ID: chunk:federal_register_of_legislation:C2025C00029:section:11
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 11
Character Range: 2096532–2099332

11                     Corporations covered by Subdivision 124‑I                                                                                                                                        sections 620‑10, 620‑15, 620‑20 and 620‑25

Division 114—Indexation of cost base

Table of sections
114‑1 Indexing elements of cost base
114‑5 When indexation relevant
114‑10 Requirement for 12 months ownership
114‑15 Cost base modifications
114‑20 When expenditure is incurred for roll‑overs

114‑1  Indexing elements of cost base
  In working out the *cost base of a *CGT asset *acquired at or before 11.45 am (by legal time in the Australian Capital Territory) on 21 September 1999, index expenditure incurred at or before that time in each element. (The expenditure can include giving property: see section 103‑5).
Note 1: Subdivision 960‑M shows you how to index amounts. The indexation does not take account of inflation after 30 September 1999.
Note 2: You have to work out the cost base of a CGT asset if a CGT event happens in relation to it or if there is a cost base modification.
Note 3: You cannot index expenditure in the third element (costs of ownership): see subsection 960‑275(4).
Note 4: Indexation is not relevant to expenditure incurred after 11.45 am on 21 September 1999 or any expenditure relating to a CGT asset acquired after that time.
Example: Peter purchases a building as an investment on 1 January 1994 for $250,000. This amount forms the first element of his cost base.
 He sold the building on 1 February 1996.
 The index number for the quarter in which he sold the building (the March quarter 1996) is 119.0. The index number for the quarter in which he purchased the building (the March quarter 1994) is 110.4.
 Applying section 960‑275, work out the indexation factor as follows:
 The indexed first element of Peter's cost base is:

114‑5  When indexation relevant
 (1) Indexation is only relevant if the *cost base of a *CGT asset is relevant to a *CGT event.
Note 1: The table in section 110‑10 sets out the CGT events for which cost base is not relevant.
Note 2: Indexation is not relevant to the reduced cost base of a CGT asset.

Indexation for some entities only if indexation chosen
 (2) Indexation is not relevant to the *capital gain of an entity mentioned in an item of the table from a *CGT event happening after 11.45 am (by legal time in the Australian Capital Territory) on 21 September 1999, unless the relevant entity mentioned in that item has chosen that the *cost base include indexation:

Entities for which indexation is not relevant unless chosen
Item                                                         Indexation is not relevant to the capital gain of this entity:  Unless this entity has chosen that the cost base include indexation: