A T O home
Legal Database
Search   
for 
 
Access the database 
Browse database
Searches  
View last document
Quick access 
View legislation
View a document
Email Cross Reference Material Previous/Next Section Contents Previous/Next Result
Printable version
Printable
version

INCOME TAX ASSESSMENT ACT 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-1 - CAPITAL GAINS AND LOSSES: GENERAL TOPICS  

Division 104 - CGT events  

Subdivision 104-F - Leases  

SECTION 104-130  Lessor receives payment for changing lease: CGT event F5  

 ITAA 36

104-130(1)  

CGT event F5 happens if a lessor receives a payment from the lessee for agreeing to vary or waive a term of the lease.

The payment can include giving property: see section 103-5.

104-130(2)  

The time of the event is when the term is varied or waived.

104-130(3)  

 View history reference
The lessor makes a capital gain if the *capital proceeds from the event are more than the expenditure the lessor incurs in relation to the variation or waiver. The lessor makes a capital loss if those capital proceeds are less.

Example:

You own a shopping centre. The lessee of a shop in the centre pays you $10,000 for agreeing to change the terms of its lease. You incur expenses of $1,000 for a solicitor and $500 for a valuer. You make a capital gain of $8,500.

104-130(4)  

The expenditure can include giving property: see section 103-5. However, it does not include an amount you have received as *recoupment of it and that is not included in your assessable income.

Exceptions

104-130(5)  

A *capital gain or *capital loss the lessor makes is disregarded if:


(a) the lease was granted before 20 September 1985; or


(b) for a lease that has been renewed or extended - the start of the last renewal or extension occurred before that day.


 



This information is provided by CCH Australia Limited. View the disclaimer and notice of copyright.
Top of page
More information on page