Document ID: chunk:federal_register_of_legislation:C2025C00029:section:3:p4
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 3 (pt 4/7)
Character Range: 4635590–4638464

an income year under Subdivision 295‑C by agreement with another entity (the transferee) in which it holds investments.

What the transferee must be
 (2) The transferee must be a *life insurance company or a *pooled superannuation trust.
Note: Amounts transferred are included in the transferee's assessable income: see section 295‑320 (for PSTs) and paragraph 320‑15(1)(i) (for life insurance companies).

Agreement requirements
 (3) The transferor may make one agreement only for an income year with a particular transferee.
 (4) An agreement:
 (a) must be in writing, and must be signed by or for the transferor and transferee; and
 (b) must be made by the day the transferor lodges its *income tax return for its income year to which the agreement relates; and
 (c) cannot be revoked.

Limits on transfer
 (5) The total amount covered by the agreements cannot exceed the amount that would otherwise be included in the transferor's assessable income under Subdivision 295‑C for that income year.
 (6) The amount covered by an agreement with a particular transferee cannot exceed this amount:
  where:
greatest equity value is the greatest of these amounts during the transferor's income year:
 (a) if the transferee is a *pooled superannuation trust—the *market value of the transferor's investment in units in the trust;
 (b) if not—the market value of the transferor's investment in:
 (i) *life insurance policies issued by the transferee; or
 (ii) a trust whose assets consist only of life insurance policies issued by the transferee.
transferor's low tax component tax rate is the rate of tax imposed on the *low tax component of the fund's taxable income for the income year.

295‑265  Application of pre‑1 July 88 funding credits

Choice to reduce contributions included in assessable income
 (1) The *superannuation provider in relation to a *complying superannuation fund can choose to reduce the amount of contributions that would otherwise be included in the fund's assessable income for an income year under item 1 of the table in section 295‑160 if it has pre‑1 July 88 funding credits available for the income year.

When funding credits are available
 (2) Use this method to work out whether a fund has pre‑1 July 88 funding credits available for an income year:

      Method statement
           Step 1. Identify the amount of pre‑1 July 88 funding credits unused at the end of the previous income year.
           Step 2. Index that amount.
                  Note: Subdivision 960‑M shows you how to index amounts.
           Step 3. Add any pre‑1 July 88 funding credits transferred to the fund in the income year under regulations made for the purposes of subsection 342(7) of the Superannuation Industry (Supervision) Act 1993.
           Step 4. Deduct from the step 3 amount:

                (a) pre‑1 July 88 funding credits transferred from the