Document ID: chunk:federal_register_of_legislation:C2025C00029:section:2:p13
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 2 (pt 13/41)
Character Range: 4264726–4267575

the excess is taken, as a balancing adjustment, to be a gain you make from the *financial arrangement for the purposes of this Subdivision. If the Step 2 amount exceeds the Step 1 amount, an amount equal to the excess is taken, as a balancing adjustment, to be a loss that you make from the arrangement. If the Step 1 amount and the Step 2 amount are equal, no balancing adjustment is made.

Proportionate transfer of all rights and/or obligations under financial arrangement
 (2) If subparagraph 250‑265(1)(c)(i) applies, you make the balancing adjustment by applying the method statement in subsection (1) but reduce:
 (a) the amounts referred to in paragraphs (a), (c) and (d) in step 1; and
 (b) the amounts referred to in paragraphs (a), (c) and (d) in step 2;
by applying the proportion referred to in subparagraph 250‑265(1)(c)(i) to them.

Transfer of specifically identified right or obligation under financial arrangement
 (3) If subparagraph 250‑265(1)(c)(ii) applies, you make the balancing adjustment by applying the method statement in subsection (1) as if the references to:
 (a) the amounts referred to in paragraphs (a), (c) and (d) in step 1; and
 (b) the amounts referred to in paragraphs (a), (c) and (d) in step 2;
were references to those amounts to the extent to which they are reasonably attributable to the right or obligation referred to in subparagraph 250‑265(1)(c)(ii).

Proportionate transfer of specifically identified right or obligation under financial arrangement
 (4) If subparagraph 250‑265(1)(c)(iii) applies, you make the balancing adjustment by applying the method statement:
 (a) as if the references to:
 (i) the amounts referred to in paragraphs (a), (c) and (d) in step 1; and
 (ii) the amounts referred to in paragraphs (a), (c) and (d) in step 2;
  were references to those amounts to the extent to which they are reasonably attributable to the right or obligation referred to in subparagraph 250‑265(1)(c)(iii); and
 (b) by reducing those amounts by applying the proportion referred to in subparagraph 250‑265(1)(c)(iii) to them.

Attribution must reflect appropriate and commercially accepted valuation principles
 (5) Any attribution made under subsection (3) or paragraph (4)(a) must reflect appropriate and commercially accepted valuation principles that properly take into account:
 (a) the nature of the rights and obligations under the *financial arrangement; and
 (b) the risks associated with each *financial benefit, right and obligation under the arrangement; and
 (c) the time value of money.

Income year for which gain or loss is made
 (6) The gain or loss you are taken to make under subsection (1), (2), (3) or (4) is a gain or loss for the income year in which the event referred to in subsection 250‑265(1) occurs.

Other provisions

250‑280  Financial arrangement received or provided