Section 681AA: Transferor or associate becomes liable for payment of rent
946.This section sets out the conditions for section 681AD or, as the case may be, section 681AE to apply in a case involving the payment of rent. It is based on section 779(1), (3), (13) and (14) of ICTA.
947.Subsection (1) lists the conditions which must be met if section 681AD (relevant income tax relief: deduction not to exceed commercial rent) is to apply.
948.The words “rent” and “lease” appear for the first time in this Chapter in subsection (1)(b). They are defined in section 681AL.
949.Subsection (2) lists the conditions which must be met if section 681AE (deduction from earnings not to exceed commercial rent) is to apply.
950.Subsection (3) explains what is meant in subsections (1)(a) and (2)(a) by “transferring” an estate or interest in land.
951.Subsection (4) explains what is meant in this Chapter by the “transferor”.
952.Subsections (5) and (6) explain what is meant in subsections (1)(b) and (2)(b) by becoming “liable” to make a payment.
953.Subsection (7) preserves the rule that, if the transfer was made before the legislation was first introduced, a lease-back after that date will not activate the legislation.