Commonwealth Consolidated Acts Commonwealth Consolidated ActsUnit held as trading stock or as a revenue asset
(1) If:
(a) any of the following conditions is satisfied:
(iii) a * Kyoto unit is transferred from your foreign account (within the meaning of the Australian National Registry of Emissions Units Act 2011 ) to your Registry account (within the meaning of that Act) or your nominee's Registry account (within the meaning of that Act);
(iv) a Kyoto unit is transferred from your nominee's foreign account (within the meaning of the Australian National Registry of Emissions Units Act 2011 ) to your Registry account (within the meaning of that Act) or your nominee's Registry account (within the meaning of that Act);
(v) an * Australian carbon credit unit is transferred from your foreign account (within the meaning of the Carbon Credits (Carbon Farming Initiative) Act 2011 ) to your Registry account (within the meaning of the Australian National Registry of Emissions Units Act 2011 ) or your nominee's Registry account (within the meaning of the Australian National Registry of Emissions Units Act 2011 );
(vi) an Australian carbon credit unit is transferred from your nominee's foreign account (within the meaning of the Carbon Credits (Carbon Farming Initiative) Act 2011 ) to your Registry account (within the meaning of the Australian National Registry of Emissions Units Act 2011 ) or your nominee's Registry account (within the meaning of the Australian National Registry of Emissions Units Act 2011 ); and
(b) as a result of the transfer, you start to * hold the unit as a * registered emissions unit; and
(c) just before the transfer, the unit was your * trading stock or * revenue asset;
you are treated as if:
(d) just before the transfer, you had sold the unit to someone else for its * cost; and
(e) you had, immediately after the sale, bought it back as a registered emissions unit for the same amount.
Example: An Australian resident company carries on a business of trading in emissions units. The units are trading stock. The company owns 10,000 emission reduction units (a type of Kyoto unit) that are registered in New Zealand. 5,000 of those emission reduction units are transferred from the company's New Zealand registry account to the company's Australian registry account.
The company is treated as having sold each unit to someone else at its cost just before it became a registered emissions unit. As the unit was previously held as trading stock, the unit ceases to be trading stock (section 70 - 12). The cost of the unit just before it became a registered emissions unit is included in the company's assessable income.
The company is also treated as having bought 5,000 registered emissions units for the same amount. The company is entitled to a deduction for that amount (section 420 - 15).
Unit held otherwise than as trading stock or as a revenue asset
(2) If:
(a) any of the following conditions is satisfied:
(iii) a * Kyoto unit is transferred from your foreign account (within the meaning of the Australian National Registry of Emissions Units Act 2011 ) to your Registry account (within the meaning of that Act) or your nominee's Registry account (within the meaning of that Act);
(iv) a Kyoto unit is transferred from your nominee's foreign account (within the meaning of the Australian National Registry of Emissions Units Act 2011 ) to your Registry account (within the meaning of that Act) or your nominee's Registry account (within the meaning of that Act);
(v) an * Australian carbon credit unit is transferred from your foreign account (within the meaning of the Carbon Credits (Carbon Farming Initiative) Act 2011 ) to your Registry account (within the meaning of the Australian National Registry of Emissions Units Act 2011 ) or your nominee's Registry account (within the meaning of the Australian National Registry of Emissions Units Act 2011 );
(vi) an Australian carbon credit unit is transferred from your nominee's foreign account (within the meaning of the Carbon Credits (Carbon Farming Initiative) Act 2011 ) to your Registry account (within the meaning of the Australian National Registry of Emissions Units Act 2011 ) or your nominee's Registry account (within the meaning of the Australian National Registry of Emissions Units Act 2011 ); and
(b) as a result of the transfer, you start to * hold the unit as a * registered emissions unit; and
(c) just before the transfer, the unit was neither your * trading stock nor your * revenue asset;
you are treated as if:
(d) just before the transfer, you had sold the unit to someone else for its * market value just before the transfer; and
(e) you had, immediately after the sale, bought it back as a registered emissions unit for the same amount.