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INCOME TAX ASSESSMENT ACT 1997 - SECT 130.80

ESS interests acquired under employee share schemes

Capital gains and losses

             (1)  Disregard any * capital gain or * capital loss to the extent that it results from a * CGT event if:

                     (a)  the CGT event happens in relation to an * ESS interest you * acquire under an * employee share scheme; and

                     (b)  the CGT event is not CGT event E4, G1 or K8; and

                     (c)  if Subdivision 83A-B applies to the interest--the time of the acquisition is the time when the CGT event happens; and

                     (d)  if Subdivision 83A-C applies to the interest:

                              (i)  the time of the acquisition is the time when the CGT event happens; or

                             (ii)  the CGT event happens on or before the * ESS deferred taxing point for the ESS interest.

             (2)  Subsection (1) does not apply if:

                     (a)  Subdivision 83A-C applies to the * ESS interest; and

                     (b)  the * CGT event happens because you forfeit or lose the ESS interest (other than by disposing of it) on or before the * ESS deferred taxing point for the interest.

General acquisition rule

             (3)  Subsection 109-5(2) (about when you acquire a CGT asset) does not apply to a * CGT asset and a * CGT event if:

                     (a)  the CGT asset is:

                              (i)  a * share; or

                             (ii)  a right to acquire a beneficial interest in a share; and

                     (b)  the CGT event is CGT event A1; and

                     (c)  you acquire an * ESS interest; and

                     (d)  the ESS interest is a beneficial interest in the share or right; and

                     (e)  Subdivision 83A-B or 83A-C (about employee share schemes) applies to the ESS interest.

Market value substitution rule

             (4)  Sections 112-20 and 116-30 (about the market value substitution rule) do not apply to the extent that they relate to:

                     (a)  you acquiring an * ESS interest to which Subdivision 83A-C (about employee share schemes) applies; or

                     (b)  you:

                              (i)  forfeiting an ESS interest; or

                             (ii)  forfeiting or losing an ESS interest that is a beneficial interest in a right (without you having disposed of the interest or exercised the right);

                            if Subdivision 83A-B or 83A-C applies to the ESS interest (ignoring section 83A- 310); or

                     (c)  you acquiring an ESS interest that:

                              (i)  is a beneficial interest in a right; and

                             (ii)  is an ESS interest to which the provisions referred to in paragraphs 83A-33(1)(a) to (c) (about start ups) apply.



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