Commonwealth Consolidated Acts

INCOME TAX ASSESSMENT ACT 1997 - SECT 242.65

  (1)   This section applies at the following times:

  (a)   if the term of the lease is extended--when the extension takes effect;

  (b)   if the lease is renewed--when the renewal takes effect;

  (c)   when the lease (including any extension or renewal of the lease) ends.

  (2)   If the sum of all amounts (whether * luxury car lease payments, a * termination amount or any other payments) that were paid or payable to the lessor under the lease exceeds the amount worked out under subsection   (4), the excess is included in the lessor's assessable income for the income year in which the relevant time occurs.

Note:   Subsection   242 - 80(8) treats the amount of a notional loan that is taken to be made by an extended or renewed lease to be a termination amount paid under the previous lease.

  (3)   If the sum of all amounts (whether * luxury car lease payments, a * termination amount or any other payments) that were paid or payable to the lessor under the lease is less than the amount worked out under subsection   (4), the lessor can deduct the difference for the income year in which the relevant time occurs.

  (4)   The amount for the purposes of subsections   (2) and (3) is the sum of:

  (a)   the notional loan principal; and

  (b)   the sum of the accrual amounts that have been or are to be included in the lessor's assessable income of any income year.

Note:   For accrual amount , see subsection   242 - 35(1).