Taxation (Annual Rates for 2016–17, Closely Held Companies, and Remedial Matters) Act 2017

16 Section CD 5 amended (What is a transfer of value?)

(1)

Replace section CD 5(2), other than the heading, with:

(2)

A company (the creditor) provides money’s worth to a person (the debtor) if the debtor is released from an obligation to pay money to the creditor, either by agreement or by operation of law, except to the extent to which—

(a)

the obligation the debtor is released from is an amount of debt to which section EW 46C(3) (Consideration when debt forgiven within economic group) applies; and

(b)

at the time the debtor is released, the debtor is a company that is a member of the same wholly-owned group as the creditor, and the debtor is described in section EW 46C(1)(a) or (b).

(2)

In section CD 5, list of defined terms, insert “wholly-owned group of companies”.

(3)

Subsection (1) applies for a person for the 2008–09 and later income years, except for an income year before the 2015–16 income year for which the person takes a tax position in a return of income that is inconsistent with the amendment made by subsection (1).