Commonwealth Consolidated Acts

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Asset passing to tax-advantaged entity: CGT event K3

             (1)  CGT event K3 happens if you die and a * CGT asset you owned just before dying * passes to a beneficiary in your estate who (when the asset passes):

                     (a)  is an * exempt entity; or

                     (b)  is the trustee of a * complying superannuation entity; or

                     (c)  is a foreign resident.

             (2)  If the asset passes to a beneficiary who is a foreign resident, CGT event K3 happens only if:

                     (a)  you were an Australian resident just before dying; and

                     (b)  the asset (in the hands of the beneficiary) is not * taxable Australian property.

             (3)  The time of the event is just before you die.

             (4)  A capital gain is made if the * market value of the asset on the day you died is more than the asset's * cost base. A capital loss is made if that market value is less than the asset's * reduced cost base.

Note:          The trustee of the estate must include in the date of death return any net capital gain for the income year when you died.


             (5)  A * capital gain or * capital loss is disregarded if you * acquired the asset before 20 September 1985.

Note:          There is also an exception for certain philanthropic testamentary gifts: see section 118-60.

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