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Digging for gold in black holes: Black hole expenditure - what's fixed and what isn't? presentation


“The Lord giveth and the Lord taketh away”. He’s not the only one. The welcome reform of the provisions for deductibility of expenditure otherwise unrecognised in the tax system (so-called “black hole expenditure”) was accompanied by an expansion of the rules defining amounts included in the CGT cost base, thus making those amounts non-deductible under the black hole rules. This presentation discusses that feature of the reform, including:

  • identifying “capital expenditure”, especially in start up contexts
  • the meaning of “in relation to” the relevant “business”, for example, in a business acquisition context
  • what expenditure on someone else’s business will be deductible.

Author profile:

Author Photo - Tim Neilson CTA
Tim Neilson CTA
Tim is a Special Counsel of Greenwoods & Freehills Pty Limited in Melbourne. Tim is a legal practitioner who practices primarily in the area of income tax and capital gains tax, generally for "large business and international" type clients, mainly in financing, major projects and M&A. He is a former State Chairman of The Tax Institute, and a member of the Advisory Board for the Monash University Journal of Australian Taxation. He has published frequently in professional journals and spoken at professional organisation conferences and seminars and guest lectures in the University of Melbourne's Masters of Laws program. Current at 01 November 2013 Click here to expand/collapse more articles by Tim NEILSON.

This was presented at 45th Victorian State Convention: Finding buried treasure.

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Individual sessions

CGT Rollovers: restructuring for the top end

Author(s):  Richard CZERWIK,  Stephen CARPENTER

Materials from this session:

International tax - there's treasure buried all over the world

Author(s):  Liam COLLINS

Materials from this session:

Consolidation...unfinished business

Author(s):  Michelle DE NIESE

Materials from this session:

The 'ins' and 'outs' of testamentary trusts

Author(s):  Bruce COOK

Materials from this session:

Exploring new waters - emerging trust issues

Author(s):  Graeme HALPERIN

Materials from this session:

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