Income Tax Act 2007 section 569

Meaning of "repo"

Section 569 defines the term "repo" for the purposes of the income tax rules on manufactured payments and sale and repurchase arrangements.

• A "repo" is a sale and repurchase arrangement involving securities, where one party sells securities and agrees to buy them back (or buy similar securities) at a later date.
• The definition captures arrangements where the original seller retains an economic interest in the securities despite having legally transferred them.
• This definition is central to determining when the manufactured payments and repo rules apply, ensuring that the tax treatment reflects the economic substance of the transaction.
• The definition was consolidated from several predecessor provisions in ICTA 1988, including sections 231AA, 231AB, 730A, 730B, 737B, 737E, and Schedule 23A paragraph 1.