Document ID: chunk:federal_register_of_legislation:F2025L00184:reg:13:p2
Version: federal_register_of_legislation:F2025L00184
Segment Type: reg
Provision Reference: reg 13 (pt 2/4)
Character Range: 11761–14415

following destruction of, or damage to, their homes in a bushfire.

 (4) If a community charity makes a distribution of property or benefits, the *market value of the property or benefits provided is to be used in determining whether the charity has complied with subsection (1).
Note: The Commissioner may approve safe harbour valuation methodologies to assist community charities in calculating the market value of a benefit—see Subdivision 960‑S of the ITAA 1997.
Example 1: If a community charity makes a distribution consisting of a gift of land to a public benevolent institution, it would use the market value of the land in calculating how much it has distributed.
Example 2: If a community charity grants a lease of office space to an eligible deductible gift recipient at a discount to the market price, the charity is providing a benefit the market value of which is used in calculating how much it has distributed. The charity may determine the market value as an amount equal to the discount.
Example 3: If a community charity invests in a social impact bond that is issued by an eligible deductible gift recipient and has a return that is less than the market rate of return on a similar corporate bond issue, the charity is providing a benefit the market value of which is used in calculating how much it has distributed. The charity may determine the market value as an amount equal to the interest saved in the financial year by the deductible gift recipient from issuing the bond at a discounted rate of return.
Example 4: If a community charity lends money to an eligible deductible gift recipient at a discount to the interest rate which would be charged on a comparable loan sourced from a financial institution at arm's length, the charity is providing the borrower with a benefit equal to the market value of the interest forgone in the financial year by the lender because the borrower was not charged an arm's length rate of interest.
Example 5: If a community charity guarantees a loan provided by a financial institution to an eligible deductible gift recipient, the charity is providing a benefit the market value of which is used in calculating how much it has distributed. The charity may determine market value as an amount equal to the discount to the interest rate which would otherwise be charged on a comparable arm's length unsecured loan sourced from that financial institution.
Example 6: Continuing example 5, if the deductible gift recipient defaults on the loan and the charity is called on under the guarantee to make a payment to the financial institution on behalf of the deductible gift recipient, the payment