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brisbane • sydney • melbourne

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A collection of updates, articles and papers written by The Little CFO & The Little CFO Legal

ATO & Commecial Debt forgiveness

Situations that attract the ATO's attention include entities that have:


๐Ÿšฉ had a debt forgiven (whether formally or informally)

a commercial debt forgiven, but the gain it represents for the debtor has not been recorded correctly in the tax return;


๐Ÿšฉ had a deemed forgiveness that takes place when a debt is assigned to a party related to the debtor;


๐Ÿšฉ entered into a debt for equity swap and failed to adjust their loss claims.



See also:


Division 245 of the ITAA 1997 โ€“ Forgiveness of a commercial debt


Debt forgiveness and CGT: https://www.ato.gov.au/Individuals/Tax-return/2021/In-detail/Publications/Guide-to-capital-gains-tax-2021/?page=10#Debt_forgiveness



Taxation Determination TD 2019/D9 Income tax: commercial debt forgiveness

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