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Schedule 2—Enhancing the integrity of the small business CGT concessions in relation to partnerships

Schedule 2 Enhancing the integrity of the small business CGT concessions in relation to partnerships

   

Income Tax Assessment Act 1997

1  Section 152-5

Omit:

Additional basic conditions must be satisfied if the CGT asset is a share in a company or an interest in a trust.

substitute:

Additional basic conditions must be satisfied in the following circumstances:

       (a)     the CGT asset is a share in a company or an interest in a trust;

      (b)     the CGT event involves certain rights or interests in relation to the income or capital of a partnership.

2  After subsection 152-10(2B)

Insert:

Additional basic condition for CGT events involving certain rights or interests in relation to the income or capital of a partnership

          (2C)  If the * CGT event involves the creation, transfer, variation or cessation of a right or interest that would entitle anentity to:

                     (a)  an amount of the income or capital of a partnership; or

                     (b)  an amount calculated by reference to a partner’s entitlement to an amount of income or capital of a partnership;

it is an additional basic condition that the right or interest is a * membership interest of the entity in the partnership:

                     (c)  immediately after the CGT event happens; or

                     (d)  if the CGT event involved the cessation of the right or interest—immediately before the CGT event happens.

3  Application

The amendments made by this Schedule apply in relation to CGT events happening after 7.30 pm, by legal time in the Australian Capital Territory, on 8 May 2018.