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INCOME TAX ASSESSMENT ACT 1997 - SECT 124.870

Roll-over for owner of units or interests in a trust

             (1)  You can choose to obtain a roll-over (whether or not the transferor and transferee choose to obtain a roll-over, and even if * CGT event J4 applies) if:

                     (a)  you own units or interests in the transferor (your original interests ); and

                     (b)  the ownership of all your units or interests ends under a trust restructure in exchange for * shares in the transferee (your replacement interests ).

Note 1:       The roll-over consequences are set out in Subdivision 124-A. The original assets are your units and interests in the transferor. The new assets are your shares in the transferee.

Note 2:       The effect of the roll-over may be reversed if the transferor does not cease to exist within 6 months: see section 104-195.

             (2)  You must make the choice for each of your original interests.

             (3)  An entity that is a foreign resident cannot choose a roll-over under this section unless the replacement interests the entity * acquires in the transferee are * taxable Australian property just after their acquisition.

             (4)  If you choose a roll-over, you cannot make a * capital loss from a * CGT event that happens to your original interests during the * trust restructuring period.

Note:          The rule in subsection (4) prevents a capital loss arising on your units or interests after the trust assets have been disposed of to the company but before your shares are issued to you.

Exception: trading stock

             (5)  This section does not apply to your ownership of an original interest ending if:

                     (a)  the interest was an item of your * trading stock and the corresponding replacement interest becomes an item of your trading stock when you * acquire it; or

                     (b)  the interest was not an item of your trading stock but the corresponding replacement interest becomes an item of your trading stock when you acquire it.



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