Commonwealth Consolidated Acts

INCOME TAX ASSESSMENT ACT 1997 - SECT 320.200

  (1)   This section applies if:

  (a)   an asset (other than money) is transferred from a * complying superannuation asset pool under subsection   320 - 180(1) or 320 - 195(2) or (3); or

  (b)   an asset (other than money) is transferred to a complying superannuation asset pool under subsection   320 - 180(3) or section   320 - 185.

  (2)   In determining:

  (a)   for the purposes of this Act (other than Parts   3 - 1 and 3 - 3) whether an amount is included in, or can be deducted from, the assessable income of a * life insurance company in respect of the transfer of the asset; or

  (b)   for the purposes of Parts   3 - 1 and 3 - 3:

  (i)   whether the company made a * capital gain in respect of the transfer of the asset; or

  (ii)   whether the company made a * capital loss in respect of the transfer of the asset;

the company is taken:

  (c)   to have sold, immediately before the transfer, the asset transferred for a consideration equal to its * market value; and

  (d)   to have purchased the asset again at the time of the transfer for a consideration equal to its market value.

  (2A)   Without limiting subsection   (2), where the asset transferred is a * depreciating asset, Division   40 has effect for the company as if:

  (a)   in relation to the sale of the asset that is taken to have occurred under paragraph   (2)(c):

  (i)   the sale were a * balancing adjustment event; and

  (ii)   the * termination value of the asset for that event were equal to the consideration for the sale under that paragraph; and

  (iii)   the company had stopped * holding the asset at the time of the sale; and

  (b)   in relation to the purchase of the asset that is taken to have occurred under paragraph   (2)(d):

  (i)   the company had only begun to hold the asset after the purchase; and

  (ii)   the first element of the asset's * cost were equal to the consideration for the purchase under that paragraph; and

  (iii)   the company had acquired the asset from an * associate of the company.

Note:   This means that, amongst other things, as a result of the transfer:

•   the asset's cost for the purposes of working out a deduction under Division   40 is reset; and
•   the company's assessable income might be adjusted under section   40 - 285.

  (3)   If, apart from this subsection and section   320 - 55, a * life insurance company could deduct an amount or make a * capital loss as a result of a transfer of an asset to or from its * complying superannuation asset pool, the deduction or capital loss is disregarded until:

  (a)   the asset ceases to exist; or

  (b)   the asset, or a greater than 50% interest in it, is * acquired by an entity other than an entity that is an * associate of the company immediately after the transfer.

  (4)   Subsection   (3) does not apply in relation to an amount that the company can deduct under a provision in Division   40.