Document ID: chunk:federal_register_of_legislation:C2010C00635:clause:3_1:p2
Version: federal_register_of_legislation:C2010C00635
Segment Type: clause
Provision Reference: sch 3 cl 1 (pt 2/3)
Character Range: 17073–19853

cost base is reduced by that sum (without the adjustment in subsection 104‑71(3)).

Example: Mandy owns units in a unit trust that she bought on 1 July 1998 for $10 each. During the 1999‑2000 income year the trustee makes 4 non‑assessable payments of $0.50 per unit. If at the end of the income year Mandy's cost base for each unit (including indexation) would otherwise be $10.10, the payments require that it be reduced by $2, giving a new cost base of $8.10. If Mandy sells the units (CGT event A1) in the 2000‑01 year for more than their cost base at that time, she will make a capital gain equal to the difference.

Exception

 (7) A *capital gain you make from *CGT event E4 is disregarded if you *acquired the *CGT asset that is the unit or interest before 20 September 1985.

104‑71  Adjustment of non‑assessable part

 (1) In working out the non‑assessable part referred to in section 104‑70, disregard any part of the payment that is:
 (a) *excluded exempt income; or
 (b) *exempt income subject to withholding tax; or
 (c) paid from an amount that has been assessed to the trustee; or
 (d) paid from an amount that is *personal services income included in your assessable income, or another entity's assessable income, under section 86‑15; or
 (e) repaid by you; or
 (f) compensation you paid that can reasonably be regarded as a repayment of all or part of the payment; or
 (g) an amount referred to in section 152‑125 (which exempts a payment of a small business 15‑year exemption amount) as an exempt amount.
The payment can include giving property (see section 103‑5).

 (2) However, the non‑assessable part is not reduced by any part of the payment that you can deduct.

 (3) The amount of the non‑assessable part referred to in section 104‑70 is adjusted to exclude any part of it that is attributable to:
 (a) an amount that is not included in the assessable income of an entity because of:
 (i) section 124ZM or 124ZN (which exempt income arising from *shares in a *PDF) of the Income Tax Assessment Act 1936; or
 (ii) section 159GZZZZE (which exempts certain payments related to infrastructure borrowings) of that Act; or
 (b) proceeds from a *CGT event that happens in relation to *shares in a company that was a *PDF when that event happened.

 (4) The amount of the non‑assessable part referred to in section 104‑70 for an entity shown in the table is adjusted to exclude the amount or amounts applicable to the entity under the table.

Adjustment of non‑assessable part
Item                               Entity                                                                                                                                                                                                                                    Amount excluded