Document ID: chunk:federal_register_of_legislation:C2025C00029:section:3:p2
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 3 (pt 2/54)
Character Range: 1090846–1093599

(1)(h) is to be given to the Commissioner no later than:
 (a) if the establishing entity lodges its *income tax return for the income year within 5 months after the end of the income year—the day the establishing entity lodges that income tax return; or
 (b) otherwise—5 months after the end of the income year.
 (5) However, expenditure is not covered under this section if the *Climate Change Secretary gives the Commissioner a notice under subsection (6) in relation to the trees.
 (6) The *Climate Change Secretary must give the Commissioner a notice in writing under this subsection if the Climate Change Secretary is satisfied that one or more of the conditions in subsection (2) have not been satisfied for the trees.
 (7) A person may apply to the *ART for review of a decision (as defined in the Administrative Review Tribunal Act 2024) of the *Climate Change Secretary to give a notice under subsection (6).
 (8) The Commissioner may give the *Climate Change Secretary a copy of the statement mentioned in paragraph (1)(h), for the purposes of subsections (5), (6) and (7).

40‑1015  Carbon sequestration by trees
  Carbon sequestration by trees means the process by which trees absorb carbon dioxide from the atmosphere.

40‑1020  Certain expenditure disregarded
  In working out a deduction under this Subdivision in relation to the establishment of trees, disregard expenditure incurred:
 (a) in draining swamp or low‑lying land; or
 (b) in clearing land.

40‑1025  Non‑arm's length transactions
  If an entity incurred capital expenditure under an *arrangement and:
 (a) there is at least one other party to the arrangement with whom the entity did not deal at *arm's length; and
 (b) apart from this section, the amount of the expenditure would be more than the *market value of what it was for;
the amount of expenditure taken into account under this Subdivision is that market value.

40‑1030  Extra deduction for destruction of trees in carbon sink forest
 (1) You can deduct the amount worked out under subsection (2) for an income year if:
 (a) you or another entity incurred capital expenditure that is covered under section 40‑1010 in relation to particular trees; and
 (b) you use the land occupied by the trees for the primary and principal purpose of *carbon sequestration by the trees; and
 (c) the trees are destroyed during the income year; and
 (d) you satisfy a condition in subsection 40‑1005(5) for the trees just before they are destroyed.
 (2) Work out the amount of the deduction as follows:

      Method statement
           Step 1. Work out the total of the amounts you could have deducted under this Subdivision in relation to the trees for the period:
                  (a) starting on the first day of the income