(2) Expressions used in this section have the same meaning as in the Fringe Benefits Tax Assessment Act 1986.
51AEB Meal entertainment—election under section 37CA of Fringe Benefits Tax Assessment Act 1986 to use the 12 week register method
(1) If a taxpayer has made an election under section 37CA of the Fringe Benefits Tax Assessment Act 1986:
(a) for each expense incurred in the FBT year by the taxpayer in providing meal entertainment, a deduction equal to the amount worked out using the following formula is allowable to the taxpayer for the year of income in which it is incurred:
Start formula Amount of expense times Register percentage end formula
(b) no other deduction under any provision of this Act is allowable to the taxpayer for the expense.
(2) The register percentage is the percentage worked out using the formula:
Start formula start fraction Total deductions for register meal entertainment over Total register meal entertainment expenses end fraction times 100% end formula
where:
Total deductions for register meal entertainment means the total of deductions that would (but for this section and section 51AEA) be allowable to the taxpayer for expenses incurred by the taxpayer in providing meal entertainment in the 12 week period covered by the register kept by the employer under Subdivision C of Division 9A of the Fringe Benefits Tax Assessment Act 1986.
Total register meal entertainment expenses means the total of expenses incurred by the taxpayer in providing meal entertainment during that 12 week period.
(3) Expressions used in this section have the same meaning as in the Fringe Benefits Tax Assessment Act 1986.
51AEC Entertainment facility—election under section 152B of Fringe Benefits Tax Assessment Act 1986 to use 50/50 split method
(1) If a taxpayer has made an election under section 152B of the Fringe Benefits Tax Assessment Act 1986:
(a) for each entertainment facility leasing expense incurred in the FBT year by the taxpayer, a deduction equal to 50% of that expense is allowable to the taxpayer for the year of income in which it is incurred; and
(b) no other deduction under any provision of this Act is allowable to the taxpayer for entertainment facility leasing expenses incurred in the FBT year.
(2) Expressions used in this section have the same meaning as in the Fringe Benefits Tax Assessment Act 1986.
51AF Car expenses incurred by employee
(1) Where:
(a) during a particular period, an employer provides a car for the exclusive use of a person who is, or of persons any of whom is, an employee of the employer or a relative of such an employee; and
(b) at any time during that period, the employee or a relative of the employee is entitled to use the car for private purposes;
a deduction is not allowable under this Act in respect of a car expense that relates to the car and:
(c) is incurred by the employee during that period; or
(d) is incurred by the employee and is wholly or partly attributable to that period.
(2) In this section:
car has the meaning given by section 995‑1 of the Income Tax Assessment Act 1997, but does not include a car covered by section 28‑165 of that Act.
car expense has the meaning given by section 28‑13 of the Income Tax Assessment Act 1997, but does not include a car expense covered by section 28‑165 of that Act.
employee means a person who receives, or is entitled to receive, work and income support related withholding payments and benefits.
employer means a person who pays or is liable to pay work and income support related withholding payments and benefits, and includes:
(a) in the case of an unincorporate body of persons other than a partnership—the manager or other principal officer of that body; and
(b) in the case of a partnership—each partner; and
(c) an Australian government agency as defined in subsection 995‑1(1) of the Income Tax Assessment Act 1997.
51AGA No deduction to employee for certain car parking expenses
No deduction
(1) A deduction is not allowable to an employee under this Act in respect of expenditure to the extent to which it is incurred in respect of the provision of car parking facilities for a car on a day if:
(a) on that day, the employee has a primary place of employment; and
(b) on that day, the car is parked for one or more daylight periods exceeding 4 hours in total at, or in the vicinity of, that primary place of employment; and
(c) the expenditure is in respect of the provision of the parking facilities to which that parking relates; and
(d) on that day, the car was used in connection with travel by the employee between:
(i) the place of residence of the employee; and
(ii) that primary place of employment; and
(e) the provision of parking facilities for the car during the period or periods is not taken, under the regulations, to be excluded from this section; and
(f) the day is on or after 1 July 1993.
Definitions
(2) In this section:
car has the same meaning as in the Fringe Benefits Tax Assessment Act 1986.
daylight period has the same meaning as in the Fringe Benefits Tax Assessment Act 1986.
employee has the same meaning as in the Fringe Benefits Tax Assessment Act 1986.
place of residence has the same meaning as in the Fringe Benefits Tax Assessment Act 1986.
primary place of employment has the same meaning as in the Fringe Benefits Tax Assessment Act 1986.
51AH Deductions not allowable where expenses incurred by employee are reimbursed
(1) Where:
(a) either of the following subparagraphs applies:
(i) a person makes a payment in discharge, in whole or in part, of an obligation of the taxpayer to pay an amount to a third person in respect of an amount of a loss or outgoing incurred by the taxpayer;
(ii) a person reimburses the taxpayer, in whole or in part, in respect of an amount of a loss or outgoing incurred by the taxpayer;
(b) the payment or reimbursement, as the case may be, constitutes:
(i) a fringe benefit; or
(ii) a benefit that, but for paragraph (g) of the definition of fringe benefit in subsection 136(1) of the Fringe Benefits Tax Assessment Act 1986, would be a fringe benefit; and
(c) in the case of a reimbursement—the amount of the reimbursement is not included in the taxpayer’s assessable income under section 15‑70 of the Income Tax Assessment Act 1997;
the amount of the deduction that, but for this section, has been allowed or would be allowable in respect of the loss or outgoing shall be:
(d) if it would be concluded that the amount of the payment or reimbursement would have been the same even if the loss or outgoing were not incurred in producing assessable income of the taxpayer—calculated as if the loss or outgoing were reduced by the amount of the payment or reimbursement; or
(e) in any other case—reduced by the amount of the payment or reimbursement.
(2) Expressions (other than “fringe benefit”) used in this section and in the Fringe Benefits Tax Assessment Act 1986 have the same respective meanings in this section as they have in that Act.
(3) This section does not apply to deductions under Division 40 of the Income Tax Assessment Act 1997 (about capital allowances).
51AJ Deductions not allowable for private component of contributions for fringe benefits etc.
(1) Where:
(a) any of the following benefits is provided in respect of the employment of an employee of an employer:
(i) an airline transport benefit;
(ii) a board benefit;
(iii) a loan benefit;
(iv) a property benefit;
(v) a residual benefit;
(b) the benefit is:
(i) a fringe benefit; or
(ii) a benefit that, but for paragraph (g) of the definition of fringe benefit in subsection 136(1) of the Fringe Benefits Tax Assessment Act 1986, would be a fringe benefit;
(c) in the case of a loan benefit—the taxpayer, being the recipient or the employee, incurs interest (in this section called the recipients interest) in respect of the loan;
(d) in the case of a benefit other than a loan benefit—the taxpayer, being the recipient or the employee, incurs consideration (in this section called the recipients contribution) to the provider or to the employer in respect of the provision of the recipients transport, the recipients meal, the recipients property or the recipients benefit, as the case may be;
(e) it would be concluded that, in calculating the amount of the recipients interest, or the amount of the recipients contribution, as the case may be, the provider or the employer made an allowance for a particular level of application or use of the benefit in producing assessable income of the taxpayer; and
(f) it would be concluded that the amount of the recipients interest, or the amount of the recipients contribution, as the case may be, would have been greater if it had been calculated without making that allowance;
the following provisions have effect:
(g) if the extent of the application or use of the benefit concerned in producing assessable income of the taxpayer is equal to, or less than, that level—a deduction is not allowable to the taxpayer under this Act in respect of the recipients interest or the recipients contribution;
(h) if the extent of the application or use of the benefit concerned in producing assessable income of the taxpayer exceeds that level—the amount of the deduction that, but for this section, has been allowed or would be allowable to the taxpayer under this Act in respect of the recipients interest or the recipients contribution shall not exceed the amount calculated in accordance with the formula:
Start formula D minus A end formula
where:
D is the amount of the deduction that, but for this section, would have been allowable to the taxpayer under this Act in respect of the amount of the recipients interest or the amount of the recipients contribution if it had been calculated without making that allowance; and
A is the amount of that allowance.
(2) Expressions (other than “recipients contribution” and “fringe benefit”) used in this section and in the Fringe Benefits Tax Assessment Act 1986 have the same respective meanings in this section as they have in that Act.
51AK Agreements for the provision of non‑deductible non‑cash business benefits
(1) Subject to this section, where:
(a) under an agreement:
(i) a taxpayer incurs expenditure; and
(ii) a non‑cash business benefit is provided to the taxpayer or another person; and
(b) that benefit is not exclusively for use or application for the purpose of producing assessable income of the taxpayer;
the taxpayer shall be treated, for the purposes of this Act, as if so much of the expenditure as does not exceed the arm’s length value of the benefit had been incurred by the taxpayer exclusively in respect of that benefit.
(2) This section does not apply so as to treat particular expenditure, or the cost of particular property, to be a particular amount for a particular purpose if there is another provision of this Act that deems that expenditure, or the cost of that property, to be a lesser amount for that purpose.
(3) A reference in this section to producing assessable income includes a reference to:
(a) gaining assessable income; or
(b) carrying on a business for the purpose of gaining or producing assessable income.
(4) Expressions used in this section and in section 21A have the same respective meanings in this section as they have in that section.
(5) In this section:
agreement means any agreement, arrangement or understanding, whether formal or informal, whether express or implied and whether or not enforceable, or intended to be enforceable, by legal proceedings.
expenditure includes a loss or outgoing.
52 Loss on property acquired for profit‑making
(1AA) This section does not apply to a loss arising in the 1997‑98 year of income or a later year of income from the carrying on or carrying out of a profit‑making undertaking or scheme, even if the undertaking or scheme was entered into, or began to be carried on or carried out, before the 1997‑98 year of income.
Note: Section 25‑40 (Loss from profit‑making scheme) of the Income Tax Assessment Act 1997 deals with such a loss.
(1A) This section does not apply in respect of the sale of property acquired on or after 20 September 1985.
(1) Any loss incurred by the taxpayer in the year of income upon the sale of any property or from the carrying on or carrying out of any undertaking or scheme, the profit (if any) from which sale, undertaking or scheme would have been included in the taxpayer’s assessable income, shall be an allowable deduction:
Provided that, in respect of property acquired by the taxpayer after the date of the commencement of this proviso, no deduction shall be allowable under this section (except where the Commissioner, being satisfied that the property was acquired by the taxpayer for the purpose of profit‑making by sale or for the carrying on or carrying out of any profit‑making undertaking or scheme, otherwise directs) unless the taxpayer, not later than the date upon which he or she lodges his or her first return under this Act after having acquired the property, notifies the Commissioner that the property has been acquired by the taxpayer for the purpose of profit‑making by sale or for the carrying on or carrying out of any profit‑making undertaking or scheme.
(2) Where:
(a) a taxpayer sells property (in this subsection referred to as the relevant property) that is deemed by subsection 25A(5) or (8) to have been acquired by the taxpayer for the purpose of profit‑making by sale;
(b) the Commissioner is satisfied that the relevant property has not been held or used by the taxpayer in a manner inconsistent with such a purpose; and
(c) the Commissioner, having regard to:
(i) the amount of the consideration paid by the person who transferred the relevant property or, in a case to which subsection 25A(8) applies, the property referred to in paragraph 25A(8)(b), to the taxpayer in respect of the purchase of the property so transferred; and
(ii) such other matters as the Commissioner considers relevant;
considers that it is appropriate that a loss be deemed to be incurred by the taxpayer upon the sale of the relevant property;
the taxpayer shall be deemed, for the purposes of this section, to have incurred a loss upon the sale of the relevant property of such amount as the Commissioner considers appropriate.
(3) Except as provided by subsection (2), a deduction is not allowable to a taxpayer under this section in respect of a loss incurred upon a sale of property to which paragraph (2)(a) applies.
(4) Where:
(a) a loss is incurred by a taxpayer upon the sale of property (in this subsection referred to as the relevant property); and
(b) the taxpayer is deemed to have acquired the relevant property for the purpose of profit‑making by sale by virtue of the application of subsection 25A(6) in accordance with subparagraph (b)(ii) of that subsection;
the deduction that would, but for this subsection, be allowable to the taxpayer under subsection (1) in respect of the loss shall be reduced by such amount (if any) as the Commissioner considers reasonable having regard to the extent to which the relevant property is attributable to the interest in property that was acquired by the taxpayer for the purpose of profit‑making by sale as mentioned in that subparagraph.
(5) A deduction is not allowable to a taxpayer under subsection (1) in respect of a loss incurred by the taxpayer upon the sale of property if:
(a) the sale is a transfer in the prescribed manner by the taxpayer for the purposes of section 25A; or
(b) the property is deemed by subsection 25A(2) to have been acquired by the taxpayer for the purposes of profit‑making by sale and was not actually acquired by the taxpayer for that purpose.
52A Certain amounts disregarded in ascertaining taxable income
(1) Notwithstanding section 8‑1 of the Income Tax Assessment Act 1997, losses or outgoings consisting of expenditure incurred by a taxpayer in the purchase or acquisition, after 7 April 1978, of any prescribed property as trading stock of the taxpayer shall, if the Commissioner considers that it would be unreasonable that a deduction be allowable to the taxpayer in respect of the whole of those losses or outgoings, be allowable as a deduction to the taxpayer to the extent only that the Commissioner considers that it is reasonable in the circumstances that a deduction be allowable to the taxpayer in respect of those losses or outgoings.
(2) Where:
(a) expenditure incurred by a taxpayer in the purchase or acquisition, after 7 April 1978, of any prescribed property that was purchased or acquired in the carrying on or carrying out of any profit‑making undertaking or scheme would, but for this subsection, be taken into account for the purpose of ascertaining whether any profit arose, or any loss was incurred, from the carrying on or carrying out of the undertaking or scheme and for the purpose of ascertaining the amount of any such profit or loss; and
(b) the Commissioner considers that it would be unreasonable that the whole of that expenditure be taken into account for those purposes;
that expenditure shall be taken into account for those purposes to the extent only that the Commissioner considers that it is reasonable in the circumstances that the expenditure be taken into account for those purposes.
(2A) Where:
(a) prescribed property that was acquired by a taxpayer after 24 September 1978 and before the commencement of this subsection or is acquired after the commencement of this subsection was or is treated or used by the taxpayer as an asset of a business carried on by the taxpayer;
(b) but for this subsection, a deduction would be allowable to the taxpayer in respect of the value of that property; and