Document ID: chunk:federal_register_of_legislation:C2025C00029:section:6:p7
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 6 (pt 7/20)
Character Range: 1570633–1573256

it as a depreciating asset for the purpose of producing your assessable income. You are treated as having sold it for its cost. This amount is assessable income, just like the proceeds of sale of any of your trading stock.
 You are also treated as having bought the item for the same amount, which is relevant to working out the item's cost for capital allowance purposes (see Subdivision 40‑C) and the item's cost base for CGT purposes (see Division 110).
 (2) This section does not apply if:
 (a) you stop holding an item as *trading stock; and
 (b) immediately after you stopped holding the item as trading stock, you start to *hold the item as a *registered emissions unit.
Note: A transaction that this section treats as having occurred is disregarded for the purposes of these provisions of the Income Tax Assessment Act 1936:
• subsection 47A(10) (which treats certain benefits as dividends paid by a CFC)
• paragraph 103A(3A)(c) (which affects whether a company is a public company for an income year).

70‑115  Compensation for lost trading stock
  Your assessable income includes an amount that:
 (a) you receive by way of insurance or indemnity for a loss of *trading stock; and
 (b) is not assessable as *ordinary income under section 6‑5.

Subdivision 70‑E—Miscellaneous

Table of sections
70‑120 Deducting capital costs of acquiring trees

70‑120  Deducting capital costs of acquiring trees
 (1) This section gives you deductions for your capital costs of acquiring land carrying trees or of acquiring a right to fell trees.
Note: This section is included in this Division because:
• trees felled for sale, or for use in manufacture, by you will usually become your trading stock; and
• before they are felled, the trees are covered by sections 70‑90 and 70‑105 because of section 70‑85.

Land carrying trees
 (2) You can deduct the amount you paid to acquire land carrying trees if:
 (a) some or all of the trees are felled during the income year for sale, or for use in manufacture, by you for the *purpose of producing assessable income; or
 (b) some or all of the trees are felled during the income year under a right you granted to another entity in consideration of payments as or by way of *royalty; or
 (c) the *market value of some or all of the trees is included in your assessable income for the income year by section 70‑90 (because you disposed of the trees outside the ordinary course of *business) or section 70‑105 (because of your death).
(It does not matter when you acquired the land.)
Note: The market value of trees is not included in your assessable income for the income year by section