Income Tax Act 2007 section 681DJ

Apportionment of payments made and of sums obtained

Section 681DJ sets out how payments that qualify for tax relief, and sums received in respect of asset interests, are to be divided up when they involve partnerships or joint owners.

• Payments qualifying for relevant tax relief made by a partnership must be apportioned on a just and reasonable basis.
• Sums received by a partnership in respect of an asset interest, where the asset continues to be used in the trade or profession, are split according to each partner's profit-sharing ratio at the time the sum is received.
• Sums received by joint owners in respect of an asset interest are split according to their respective rights in that interest, unless the partnership rule applies instead.
• The partnership apportionment rule takes priority over the joint ownership rule where both could apply.

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