Document ID: chunk:federal_register_of_legislation:C2010C00499:clause:10_5:p1
Version: federal_register_of_legislation:C2010C00499
Segment Type: clause
Provision Reference: sch 10 cl 5 (pt 1/2)
Character Range: 118919–121508

5                Any other provision of this Act or the Income Tax Assessment Act 1936        the cost of the interest or asset at the start of the hybrid year or the post‑hybrid year is varied so that it equals the partner's *tax cost setting amount for the interest, or the entity's tax cost setting amount for the asset, at that time in relation to the *asset‑based income tax regime

830‑95  What the expression tax cost setting amount means

 (1) A partner's tax cost setting amount for an interest of the partner in an asset at the start of the hybrid year, in relation to an *asset‑based income tax regime, is worked out as follows:

      Method statement
           Step 1. Work out what would have been the entity's *tax cost of the asset for the purposes of applying the *asset‑based income tax regime as at the start of the hybrid year if it were not a *foreign hybrid in relation to the hybrid year.
           Step 2. Multiply the result of step 1 by:

                (a) if the entity is a *foreign hybrid company in relation to the hybrid year—the percentage applicable to the partner under subsection 830‑35(2); or
                (b) if the entity is a *foreign hybrid limited partnership in relation to the hybrid year—the individual interest of the partner in the asset, expressed as a percentage of the interests of all of the partners in the asset.

           Step 3. If the partner paid a premium in respect of the *acquisition of its interest in the asset (see subsection (2)), add the amount of the premium to the result of step 2. If the partner received a discount in respect of the acquisition (see subsection (2)), subtract the amount of the discount from the result of step 2, but not to the extent that this would result in a negative amount.
            The result of step 3 is the partner's tax cost setting amount in respect of the asset.
 (2) Work out whether the partner paid a premium or received a discount for its interest in the asset using the following method statement:

      Method Statement
           Step 1. Add up all the amounts paid by the partner before the start of the hybrid year for its *shares in the entity (if the entity was a company), or for its interests in the assets of the entity and in the entity (if the entity was a *limited partnership), that it held at the start of the hybrid year, and subtract all amounts received by the partner in respect of those shares or interests by way of reduction in capital of the entity.
           Step 2. Work out the amount that, if the capital of the entity had been distributed