Document ID: chunk:federal_register_of_legislation:C2004C00927:clause:5_1:p4
Version: federal_register_of_legislation:C2004C00927
Segment Type: clause
Provision Reference: sch 5 cl 1 (pt 4/5)
Character Range: 554403–556945

70-90 and 70-95 of the Income Tax Assessment Act 1997 to disposals of trading stock outside the ordinary course of business

  Sections 70-90 (Assessable income on disposal of trading stock outside the ordinary course of business) and 70-95 (Purchase price is taken to be market value) of the Income Tax Assessment Act 1997 apply to a disposal of an item of trading stock that takes place on or after 1 July 1997.

[The next section is section 70‑100.]

70‑100  Application of section 70-100 of the Income Tax Assessment Act 1997 to disposals of trading stock outside ordinary course of business

Basic application

 (1) Section 70-100 (Notional disposal when you stop holding an item as trading stock) of the Income Tax Assessment Act 1997 applies to trading stock that stops being trading stock on hand of an entity on or after 1 July 1997.

Transitional provision if that section affects an assessment for 1996-97

 (2) The value of trading stock to which subsection (4) of that section applies is to be worked out using the rules in the Income Tax Assessment Act 1936 (and not the rules in Subdivision 70‑C of the Income Tax Assessment Act 1997) if:
 (a) that section affects an assessment for the 1996-97 year of income under the Income Tax Assessment Act 1936; and
 (b) an election is made under subsection (4) of that section to value trading stock at what would have been its value at the end of an income year ending on the day it became trading stock on hand of the second entity.

Note: Section 70‑100 of the Income Tax Assessment Act 1997 may affect an assessment for the 1996‑97 income year if any of the entities with an interest in the trading stock (either before or after it becomes trading stock on hand of the second entity) has a 1996-97 income year ending on or after 1 July 1997.

70‑105  Application of section 70-105 of the Income Tax Assessment Act 1997 to deaths on or after 1 July 1997

 (1) Section 70-105 (Death of owner) of the Income Tax Assessment Act 1997 applies to trading stock that devolves as a result of a person dying on or after 1 July 1997.

Transitional provision if that section affects an assessment for 1996-97

 (2) The value of an item to which subsection (3) or (4) of that section applies is to be worked out using the rules in the Income Tax Assessment Act 1936 (and not the rules in Subdivision 70‑C of the Income Tax Assessment Act 1997) if:
 (a) that section affects an assessment for the 1996-97 year of income under the Income Tax Assessment Act 1936; and
 (b) an election is made