## Commonwealth Consolidated Acts

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INCOME TAX ASSESSMENT ACT 1997 - SECT 974.50

**Valuation of financial benefits--value in present value terms**
(1) Subject to the regulations made for the purposes of
subsection (5), the value in present value terms of a
* financial benefit to be provided or received in respect of an interest (the
*test interest *) is calculated under subsection (4).

(2) If you need to calculate the values in present value terms of a
number of
* financial benefits, the value of each financial benefit is to be calculated
separately.

(3) The value of a
* financial benefit is to be calculated assuming that all amounts to be paid
by an entity in respect of the test interest are paid at the earliest time
when the entity becomes liable to pay them.

(4) The value of a
* financial benefit in present value terms is:

where:

*
"adjusted benchmark rate of return" *is 75% of the
* benchmark rate of return on the test interest.

* "n" *is the number of years
in the period starting on the day on which the test interest is issued and
ending on the day on which the
* financial benefit is to be provided. If the period includes a part of a
year, that part is to be expressed as the fraction:

*
"year" *means a period of 12 months.

(5) The regulations may provide for the method of calculating the value
in present value terms of a
* financial benefit.

(6) Without limiting subsection (5), the regulations may:

(a) provide for an entirely different method of calculating the
present value of the
* financial benefit; or

(b) specify the adjusted
* benchmark rate of return; or

(c) provide for a different method of determining the
adjusted benchmark rate of return; or

(d) specify rules for determining whether a
* debt interest is an * ordinary debt interest.

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