Document ID: chunk:federal_register_of_legislation:C2025C00029:section:2:p12
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 2 (pt 12/18)
Character Range: 2715383–2718010

prevents the revocation or variation of that choice; or
 (ii) sets out a consequence for an entity if that choice is revoked or varied;
that provision is taken to apply for a mirror choice, in force for the other trust at or after that time, in a way corresponding to the way in which it applies for the first choice.
Note: For example, if the provision sets out consequences that flow from the revocation of the first choice, then those consequences will also flow if the mirror choice is revoked.

126‑240  Consequences for the trusts

Disregard any capital gain or loss
 (1) If the roll‑over is chosen, disregard any *capital gain or *capital loss the trustee of the transferring trust makes from:
 (a) creating the receiving trust over the roll‑over asset; or
 (b) transferring the roll‑over asset to the receiving trust;
at the transfer time.

Adjust roll‑over asset's cost base and reduced cost base
 (2) If the roll‑over is chosen:
 (a) the first element of the roll‑over asset's *cost base, in the hands of the receiving trust, is its cost base just before the transfer time; and
 (b) the first element of the roll‑over asset's *reduced cost base is worked out similarly.

Any pre‑transfer losses of receiving trust cannot be utilised
 (3) If the roll‑over is chosen:
 (a) any *net capital loss of the receiving trust for an income year ending before the transfer time cannot be applied after the transfer time to reduce an amount of that trust's *capital gains; and
 (b) the sum of the receiving trust's *capital losses for the income year that includes the transfer time (the transfer year) is reduced by an amount equal to any net capital loss that the trust would have had for that year had that year ended just before the transfer time; and
 (c) any *tax loss of the receiving trust for an income year ending before the transfer time cannot be deducted after the transfer time from an amount of that trust's assessable income or *net exempt income; and
 (d) the sum of the receiving trust's deductions for the transfer year is reduced by an amount equal to any tax loss that the trust would have had for that year had that year ended just before the transfer time.
References in this subsection to the transfer time are to be read as references to the start time if subsection 126‑225(2) applies.
Note: Subsection 126‑225(2) applies if the roll‑over asset is transferred to the receiving trust after an earlier roll‑over under this Subdivision, for another asset, was obtained for the trusts.

Pre‑CGT assets
 (4) If:
 (a) the roll‑over is chosen; and
 (b) the transferring trust last *acquired the roll‑over asset