Document ID: chunk:federal_register_of_legislation:C2025C00014:section:159gzzzq:p2
Version: federal_register_of_legislation:C2025C00014
Segment Type: section
Provision Reference: s 159GZZZQ (pt 2/3)
Character Range: 1470079–1472645

any year of income (disregarding section 128D of this Act and section 802‑15 of the Income Tax Assessment Act 1997); or
 (ii) an eligible non‑capital amount (see subsection (5)).
The amount worked out is the reduction amount in respect of the buy‑back.

Eligible non‑capital amount
 (5) An amount is an eligible non‑capital amount if it is neither:
 (a) debited against a share capital account or a reserve to the extent that it consists of profits from the revaluation of assets of the company that have not been disposed of by the company; nor
 (b) attributable, either directly or indirectly, to amounts that were transferred from such an account or reserve of the company.

Debit for deemed dividend
 (7) For the purposes of subsection (5), an amount of the purchase price that is taken to be a dividend by section 159GZZZP is taken to have been debited against the account or reserves against which the purchase price was debited, and to the same extent.

Offsetable amount excluded from reduction where loss
 (8) If:
 (aa) the seller is a corporate tax entity; and
 (a) the amount of consideration that the seller is taken by subsection (1) or (2) to have received or to be entitled to receive in respect of the sale of the share is, apart from this subsection, reduced by a reduction amount under subsection (3); and
 (b) the dividend mentioned in paragraph (4)(a), so far as it does not exceed the reduction amount, consists to any extent of an offsetable amount (see subsection (9)); and
 (c) disregarding this subsection, as a result of the operation of this section:
 (i) for the purposes of Parts 3‑1 and 3‑3 of the Income Tax Assessment Act 1997 (about CGT), the seller incurs a capital loss or an increased capital loss (which loss or increase is the loss amount) in respect of the buy‑back; or
 (ii) a loss, or an increased loss, (which loss or increase is also the loss amount) in respect of the buy‑back is allowable as a deduction to the seller under a provision of a Part of this Act other than Part 3‑1 or 3‑3 of the Income Tax Assessment Act 1997; or
 (iii) the amount of a deduction allowable from the seller's assessable income of any year of income in respect of the issue or acquisition of the share exceeds, or exceeds by a greater amount, (the excess or increased excess is also the loss amount) the amount included in the seller's assessable income of any year of income in respect of the buy‑back of the share;
then the reduction in the amount of the consideration under subsection (3) is instead a reduction equal to:
 (d) the reduction