Apportionment—business assets in this and other jurisdictions
28 Apportionment—business assets in this and other jurisdictions
Business assets to which this section applies This section applies to a business asset referred to in section 11 (1) (g), being—
the goodwill of a business, if the business has also supplied goods outside New South Wales, or provided services outside New South Wales, to a customer of the business during the previous 12 months, or
intellectual property that has also been used or exploited in one or more other Australian jurisdictions during the previous 12 months, or
a statutory licence or permission under a Commonwealth law if the rights under the licence or permission have been exercised during the previous 12 months in respect of one or more other Australian jurisdictions.
How is the dutiable value of a business asset determined? The dutiable value (DV) of a business asset to which this section applies is to be determined in accordance with the following formula—
where—
A is the unencumbered value of the business asset, or so much of the consideration for the dutiable transaction as relates to the business asset, whichever is the greater, and
X is the gross amount (expressed in Australian dollars) of goods supplied, and services provided, in New South Wales by the business to customers of the business during the last 3 completed financial years preceding the dutiable transaction, and
Y is the gross amount (expressed in Australian dollars) of goods supplied, and services provided, in and outside New South Wales by the business to customers of the business during the last 3 completed financial years preceding the dutiable transaction.
Subsection (2) applies to intellectual property together with goodwill as if the intellectual property and goodwill comprise a single business asset.
If an apportionment cannot be made under subsection (2), the Chief Commissioner may make an apportionment on such basis as the Chief Commissioner considers appropriate in the circumstances.
In this section, a reference to a service provided to a customer includes a reference to anything done for a customer pursuant to a contractual obligation.
This section applies only to dutiable transactions that occur before 1 July 2016 (the date on which duty on transfers of business assets is abolished).
This Act’s bill:Explanatory memorandumSecond reading speech
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