Document ID: chunk:federal_register_of_legislation:C2016A00010:clause:1_13
Version: federal_register_of_legislation:C2016A00010
Segment Type: clause
Provision Reference: sch 1 cl 13
Character Range: 20968–23436

13  At the end of section 152‑20
Add:

Effect of look‑through earnout rights
 (5) Despite subsections (1) to (4), in working out the net value of the CGT assets of an entity at the time just before the *CGT event (the valuing time), you can make a choice under subsection (6) if:
 (a) at the valuing time, one or more of the entity's *CGT assets were assets for which the entity later provided, or was later provided with, one or more *financial benefits under one or more *look‑through earnout rights that were in existence at the valuing time; or
 (b) at the valuing time, one or more of the entity's CGT assets were look‑through earnout rights relating to CGT assets of:
 (i) one or more of the other entities referred to in section 152‑15; or
 (ii) one or more entities not referred to in that section; or
 (c) you are the entity, and:
 (i) the CGT event referred to in section 152‑15 happened because you *disposed of a CGT asset; and
 (ii) your *capital proceeds from the disposal were affected by one or more financial benefits provided to, or by, you under one or more look‑through earnout rights;
and no further financial benefits can be provided under any of those look‑through earnout rights.
Note: For paragraph (c), capital proceeds can be affected by financial benefits provided under a look‑through earnout right (see section 116‑120).
 (6) You can choose to treat the *market value of each of the *CGT assets first mentioned in the applicable paragraph of subsection (5) as if it were, at the valuing time, equal to:
 (a) if paragraph (5)(a) applies—the first element of the CGT asset's *cost base at the valuing time; or
 (b) if subparagraph (5)(b)(i) applies—nil; or
 (c) if subparagraph (5)(b)(ii) applies—the total of the financial benefits provided under the *look‑through earnout right after the valuing time; or
 (d) if paragraph (5)(c) applies—those *capital proceeds.
Note: For paragraph (a), the first element of a CGT asset's cost base can be affected by financial benefits provided under a look‑through earnout right (see section 112‑36).
 (7) In working out the net value of the CGT assets of an entity at the valuing time, if:
 (a) you make a choice under subsection (6) about a *CGT asset of the entity that is a CGT asset covered by paragraph (5)(a) or (c); and
 (b) a *look‑through earnout right covered by that paragraph is also a CGT asset of the entity;
treat the *market value of that right as if it were nil at the valuing time.