Document ID: chunk:federal_register_of_legislation:C2004A04148:body:0:p20
Version: federal_register_of_legislation:C2004A04148
Segment Type: other
Provision Reference: 
Character Range: 60376–63039

(ii) because of any entry contribution of the person; and

    (c)     the interest on a loan includes any payment for the use of the money that is lent; and

    (d)     if the interest that is paid on a loan is received or accounted for less frequently than each anniversary of the making of the loan, interest on the loan is taken to be received by the lender on each anniversary of the making of the loan.

Loans that do not attract interest

  "46zd. (1) If:

  (a)     there is a loan by a person; and

  (b)     the person is not paid interest on the loan;

the person is taken to receive on each anniversary of the making of the loan interest on the loan at the assumed loan rate.

Note: for 'assumed loan rate' see section 46zg.

  "(2) Subsection (1) has effect subject to section 46zf.

Loans that attract a low rate of interest

  "46ze. (1) If:

  (a) there is a loan by a person; and

SCHEDULE 2—continued

  (b)    the person is paid interest on the loan; and

  (c)     the rate of interest is less than the assumed loan rate;

the person is taken to receive interest on the loan at the assumed loan rate.

Note: for 'assumed loan rate' see section 46zg.

  "(2) Subsection (1) has effect subject to section 46zf.

Certain loans to be disregarded

"46zf. (1) The Minister may determine that this Division does not apply to:

  (a)     a specified loan; or

  (b)    a specified class of loans.

"(2) A determination under subsection (1) is to be made by notice in writing.

  "(3) If:

  (a)     there is a loan by a person; and

  (b)    a determination under subsection (1) applies to the loan;

the loan is to be disregarded for the purposes of applying this Division to the person.

Assumed loan rate of interest

  "46zg. The assumed loan rate is:

   (a)     10% per year; or

     (b)     if a lower rate is determined under subsection 1099l (2) of the Social Security Act—that lower rate.

"Division 8C—Income attributed to deprived assets

Application of this Division

"46zh. This Division applies to dispositions of assets that occur after 21 August 1990.

Income attributed to deprived assets

  "46zj. If:

   (a)     a person disposes of an asset; and

     (b)     the value of the asset is included in the value of the person's assets under section 52g or 52h;

the following provisions have effect:

   (c)     the person is taken to obtain income from the asset; and

   (d)     the income is taken to be:

         (i) interest on the value of the asset at the assumed property rate; or

SCHEDULE 2—continued

         (ii) the amount calculated in accordance with subsection 48d (3);

     whichever is the higher.

Note: for