Document ID: chunk:federal_register_of_legislation:C2004A02157:body:0:p5
Version: federal_register_of_legislation:C2004A02157
Segment Type: other
Provision Reference: 
Character Range: 9722–12209

than the amount of the loss that the recipient taxpayer would be deemed to have incurred in the relevant year of income if an amount equal to the prescribed relevant expenditure were not included in the assessable income of the recipient taxpayer of the relevant year of income,
then, notwithstanding anything contained in the Income Tax Assessment Act 1936, a deduction is not allowable to the associated taxpayer in respect of any part of the prescribed relevant expenditure.
     (2) Where—
     (a) the value of the trading stock of a taxpayer that, but for this sub-section, would be taken into account at the end of the year of income that commenced on 1 July 1978 (in this sub-section referred to as the "relevant year of income") for the purposes of the Income Tax Assessment Act 1936 is greater than the value of that trading stock that would be taken into account at that time if the taxpayer had valued that trading stock in such a way that the value of that trading stock to be taken into account at that time would have been the lowest possible amount at which the value of that trading stock could be taken into account at that time in accordance with Subdivision B of Division 2 of Part III of the Income Tax Assessment Act 1936;
     (b) if the taxpayer had valued the trading stock of the taxpayer in such a way that the value of that trading stock to be taken into account at the end of the relevant year of income would have been the lowest possible amount at which the value of that trading stock could have been taken into account at that time in accordance with Subdivision B of Division 2 of Part III of the Income Tax Assessment Act 1936, the taxpayer would have been deemed to have incurred a loss in the relevant year of income;
     (c) if, in determining whether the taxpayer is deemed to have incurred a loss in the relevant year of income and in determining the amount of any such loss—
          (i) the value of the trading stock of the taxpayer to be taken into account at the end of the relevant year of income were the value referred to in paragraph (b); and
          (ii) the conditions specified in the paragraphs of sub-section 80 (5) of the Income Tax Assessment Act 1936 were taken to be applicable,
     the taxpayer would not be deemed to have incurred a loss in the relevant year of income or would be deemed to have incurred a loss in the relevant year of income of an amount less than the amount of the loss referred to in paragraph (b); and