Commonwealth Consolidated Acts Commonwealth Consolidated ActsConsequences for the originating company in all cases
(1) A * capital gain the originating company makes from the trigger event is disregarded.
Consequences for the recipient company (disposal case)
(2) For a disposal case, if the originating company * acquired the roll - over asset on or after 20 September 1985:
(a) the first element of the asset's * cost base (in the hands of the recipient company) is the asset's cost base (in the hands of the originating company) when the recipient company acquired it; and
(b) the first element of the asset's * reduced cost base (in the hands of the recipient company) is worked out similarly.
Note 1: There are special indexation rules for roll - overs: see Division 114.
Note 2: The reduced cost base may be modified for a roll - over happening after a demerger: see section 125 - 170.
(3) If the originating company * acquired the roll - over asset before 20 September 1985, the recipient company is taken to have acquired it before that day.
Note 1: A capital gain or loss you make from a CGT asset you acquired before 20 September 1985 is generally disregarded: see Division 104. This exemption is removed in some situations: see, for example, Division 149.
Note 2: Under section 716 - 855, where there have been certain roll - overs, the cost base and reduced cost base of pre - CGT assets for the purposes of Part 3 - 90 (Consolidated groups) are worked out by applying subsection (2), rather than subsection (3), of this section.
(4) If the trigger event involved a * personal use asset of the originating company, the recipient company is taken to have * acquired one.
Consequences for the recipient company (creation case)
(5) For a creation case, the first element of the asset's * cost base (in the hands of the recipient company) is the amount applicable under this table. The first element of its * reduced cost base is worked out similarly.
Creation case | |
Event No. | Applicable amount |
D1 | the * incidental costs the originating company incurred that relate to the trigger event |
D2 | the expenditure the originating company incurred to grant the option |
D3 | the expenditure the originating company incurred to grant the right |
F1 | the expenditure the originating company incurred on the grant, renewal or extension of the lease |
The expenditure can include giving property: see section 103 - 5.
Note: CGT event J1 may occur if the recipient company stops being a member of the wholly - owned group while still owning the roll - over asset: see section 104 - 175.