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INCOME TAX ASSESSMENT ACT 1997 - SECT 126.245

Consequences for beneficiaries--general approach for working out cost base etc.

             (1)  If the roll-over is chosen, each of the following:

                     (a)  the * cost base and * reduced cost base of each of a beneficiary's * membership interests in each trust;

                     (b)  the time each of the beneficiary's membership interests in the receiving trust is treated as having been * acquired;

is adjusted under this section for the transfer time unless the beneficiary has chosen for them to be adjusted under section 126-250.

Note:          The beneficiary can choose for these things to be adjusted once for several consecutive transfer times (for multiple roll-over assets) if the beneficiary owned the interests at all of those times (see section 126-250).

First element of cost base of interests in transferring trust

             (2)  The first element of the * cost base, just after the transfer time, of each of the beneficiary's * membership interests in the transferring trust is an amount equal to such proportion of the interest's cost base just before the transfer time as is reasonable having regard to:

                     (a)  the * market value of the interest just after the transfer time, or a reasonable approximation of that market value; and

                     (b)  the market value of the interest just before the transfer time, or a reasonable approximation of that market value.

First element of cost base of interests in receiving trust

             (3)  The first element of the * cost base, just after the transfer time, of each of the beneficiary's * membership interests in the receiving trust is such amount so that the sum of:

                     (a)  the cost base, just before the transfer time, of that membership interest in the receiving trust; and

                     (b)  if, just after the transfer time, that interest in the receiving trust corresponds to at least one of the beneficiary's membership interests in the transferring trust--the cost base, just before the transfer time, of each of those corresponding membership interests in the transferring trust; and

                     (c)  if, just after the transfer time, that interest in the receiving trust corresponds to a proportion of one of the beneficiary's membership interests in the transferring trust--that proportion of the cost base, just before the transfer time, of that corresponding membership interest in the transferring trust;

reasonably approximates:

                     (d)  if paragraph (b) applies--the sum of the cost bases, just after the transfer time, of each of the interests referred to in paragraphs (a) and (b); and

                     (e)  if paragraph (c) applies--the sum of:

                              (i)  the cost base, just after the transfer time, of the interest referred to in paragraph (a); and

                             (ii)  the proportion of the cost base, just after the transfer time, of the interest referred to in paragraph (c).

First element of reduced cost base of interests in each trust

             (4)  The first element of the * reduced cost base, just after the transfer time, of each of the beneficiary's * membership interests in each trust is worked out similarly.

Time of acquisition for interests in the receiving trust

             (5)  Each of the beneficiary's * membership interests in the receiving trust is treated as having been * acquired just after the transfer time.

Time of acquisition for pre-CGT interests in the receiving trust

             (6)  However, if one or more of the beneficiary's * membership interests in the transferring trust were * pre-CGT assets just before the transfer time, the beneficiary is treated as having * acquired before 20 September 1985 its interests in the receiving trust that correspond to those interests in the transferring trust.



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