36CEffect of certain mortgages on trust exemptions

36C Effect of certain mortgages on trust exemptions (1) Despite section 21, the Commissioner is not to treat a transfer as part of a sale or arrangement for the purposes of section 36, 36A or 36B only because, at the time of or immediately after the transfer, the beneficiary or unitholder— (a) gives a mortgage to secure the same or a greater amount as that outstanding under a mortgage to which the property was subject immediately before the time of the transfer; or (b) assumes the liabilities under a mortgage to which the property was subject immediately before the time of the transfer— if the Commissioner is satisfied that the giving of the mortgage or the assumption of liability is not part of a sale or other arrangement designed to take advantage of an exemption or concession under section 36, 36A or 36B (as the case requires). (2) Despite section 21, in determining, for the purposes of section 36 or 36B, the dutiable value of property transferred to a beneficiary or unitholder, the dutiable value is to be reduced by the value of any mortgage to which the property is subject at or immediately after the time of the transfer if— (a) the mortgage is given by the beneficiary or unitholder to secure the same or a greater amount as that outstanding under a mortgage to which the property was subject immediately before the time of the transfer, or the liabilities under the mortgage are assumed by the beneficiary or unitholder; and (b) the Commissioner is satisfied that the giving of the mortgage or the assumption of liability under it is not part of a sale or other arrangement designed to take advantage of an exemption or concession under section 36 or 36B (as the case requires). (3) Without limiting the ways in which the Commissioner may be satisfied for the purposes of subsection (1) or (2)(b), the Commissioner will be taken to be satisfied if— (a) the mortgage was created at or before the time the property became subject to the principal trust or the unit trust scheme (as the case requires); or (b) the mortgage was part of a genuine re‑financing of a mortgage referred to in paragraph (a); or (c) the mortgage was created to secure borrowings that have been applied to the improvement of the property.