Commonwealth Consolidated Acts

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INCOME TAX ASSESSMENT ACT 1997 - SECT 32.75

Commissioner may treat you as having incurred entertainment expense

                   If:

                     (a)  you incur a loss or outgoing under an * arrangement; and

                     (b)  someone provides * entertainment under the arrangement to you or someone else; and

                     (c)  section 32-5 would have stopped you deducting the loss or outgoing under section 8-1 (which deals with general deductions) if you had incurred it in respect of providing that entertainment;

this Division applies to you as if you had incurred the loss or outgoing in providing that entertainment, to the extent (if any) that the Commissioner thinks reasonable.

Note:          This means that section 32-5 will prevent you from deducting the loss or outgoing under section 8-1 unless an exception applies.

Example:    A company pays $1,000 to sponsor a football game. Under the same arrangement, the company is given a viewing box at the game. To the extent the Commissioner thinks reasonable, he or she can treat the company as having incurred the $1,000 in providing entertainment.

Table of sections

32-80        Company directors

32-85        Directors, employees and property of wholly-owned group company

32-90        Partnerships



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