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Division 149—When an asset stops being a pre-CGT asset

Table of Subdivisions

149-A Key concepts

149-B When asset of non-public entity stops being a pre-CGT asset

149-C When asset of public entity stops being a pre-CGT asset

149-D How to treat holdings of less than 1% in certain entities

149-E How to treat certain interposed funds, companies and government bodies

149-F How to treat a "demutualised" public entity

Subdivision 149-A—Key concepts

Table of sections

149-10 What is a pre-CGT asset?

149-15 Majority underlying interests in a CGT asset

149-10 What is a pre-CGT asset?

A *CGT asset that an entity owns is a pre-CGT asset if, and only if:

(a) the entity last acquired the asset before 20 September 1985; and

(b) the entity was not, immediately before the start of the 1998-99 income year, taken under:

(i) subsection 160ZZS(1) of the Income Tax Assessment Act 1936; or

(ii) Subdivision C of Division 20 of Part IIIA of that Act;

to have acquired the asset on or after 20 September 1985; and

149-15 Majority underlying interests in a CGT asset

(1) Majority underlying interests in a *CGT asset consist of:

(a) more than 50% of the beneficial interests that *ultimate owners have (whether directly or *indirectly) in the asset; and

(b) more than 50% of the beneficial interests that *ultimate owners have (whether directly or *indirectly) in any *ordinary income that may be *derived from the asset.

(2) An underlying interest in a *CGT asset is a beneficial interest that an *ultimate owner has (whether directly or *indirectly) in the asset or in any *ordinary income that may be *derived from the asset.

(3) An ultimate owner is:

(a) an individual; or

(b) a company whose *constitution prevents it from making any distribution, whether in money, property or otherwise, to its members; or

(d) a municipal corporation; or

(e) a local governing body; or

(f) the government of a foreign country, or of part of a foreign country.

(4) An *ultimate owner indirectly has a beneficial interest in a *CGT asset of another entity (that is not an *ultimate owner) if he, she or it would receive for his, her or its own benefit any of the capital of the other entity if:

(a) the other entity were to distribute any of its capital; and

(b) the capital were then successively distributed by each entity interposed between the other entity and the ultimate owner.

(5) An *ultimate owner indirectly has a beneficial interest in *ordinary income that may be *derived from a *CGT asset of another entity (that is not an *ultimate owner) if he, she or it would receive for his, her or its own benefit any of a *dividend or income if:

(a) the other entity were to pay that dividend, or otherwise distribute that income; and

(b) the dividend or income were then successively paid or distributed by each entity interposed between the other entity and the ultimate owner.

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