Document ID: chunk:federal_register_of_legislation:C2011C00610:clause:4_14:p5
Version: federal_register_of_legislation:C2011C00610
Segment Type: clause
Provision Reference: sch 4 cl 14 (pt 5/6)
Character Range: 198192–200859

from being a *farm management deposit.

Note: Subsections (4) and (5) mean that, despite subsection 393‑30(1) (which prevents a deposit, or part of a deposit, from being a farm management deposit if certain requirements are not met), the fact that you are the owner of both the new deposit with one financial institution and the old deposit with another financial institution does not prevent the new deposit from being a farm management deposit.

Unrecouped FMD deduction for new deposit less than old deposit

 (6) Despite subsection (2) and subsection 393‑15(3), if the new deposit is less than the old deposit at the time (the declaration time) the old ADI became a declared ADI under the Banking Act 1959, the unrecouped FMD deduction in respect of the new deposit is the amount worked out using the following formula:

Note: The new deposit could be less than the old deposit if the entitlement is paid in instalments (each of which will be a separate new deposit).

 (7) However, if the amount worked out under subsection (6) is more than the difference (if any) between:
 (a) the *unrecouped FMD deduction in respect of the old deposit just before the declaration time; and
 (b) the total of the amounts worked out under all previous applications of subsection (6) in relation to that old deposit;
the unrecouped FMD deduction in respect of the new deposit is equal to the difference (if any).

Note: This ensures that when new deposits linked to the old deposit are repaid, the total amount included in assessable income will not exceed the unrecouped FMD deduction in respect of the old deposit.

Relationship with other provisions

 (8) This section has effect despite Division 253 (about tax treatment of entitlements under the financial claims scheme for insolvent ADIs).

393‑60  Repayment if owner of farm management deposit with insolvent ADI dies, is bankrupt or ceases to be a primary producer

  Subsection 393‑10(4) does not apply in relation to so much of a *farm management deposit with an *ADI as is equal to the sum of the amounts described in subparagraphs (d)(i) and (ii) of this section if:
 (a) you are the *owner of the deposit; and
 (b) the deposit becomes repayable during an income year because of the requirement contained in the relevant agreement as set out in item 11 of the table in section 393‑35 (death, bankruptcy etc.); and
 (c) during the income year, the ADI becomes a declared ADI under Division 2AA (Financial claims scheme for account‑holders with insolvent ADIs) of Part II of the Banking Act 1959; and
 (d) at the end of the income year, you have either or both of the following:
 (i) an unmet entitlement under that