Income tax: when does the 10 year exemption period commence in relation to direct or indirect infrastructure borrowings under Division 16L of Part III of the Income Tax Assessment Act 1936 ?

Draft Taxation Determinations (TDs) present the preliminary, though considered, views of the ATO. Draft TDs may not be relied on; only final TDs are authoritative statements of the ATO.

Draft Taxation Determinations (TDs) present the preliminary, though considered, views of the ATO. Draft TDs may not be relied on; only final TDs are authoritative statements of the ATO.

The exemption period commences at the time of the borrowing. The time of the borrowing is when the lender borrower relationship is created , that is when the agreement is entered into - not when the funds are used. Example On 1 July a company enters into a loan agreement to obtain funds over a two year construction period. The borrowed funds are to be spent on a qualifying infrastructure facility. The exemption period commences on 1 July.