Income Tax Act 2007 section 809

Other definitions

Section 809 provides additional definitions and interpretive rules used in the licence-related trading loss provisions of sections 805 to 808, particularly concerning non-active partners and the meaning of agreements related to licences.

• The concept of "non-active partner in an early tax year" in sections 805 and 806 takes its meaning from the general partnership loss relief rules in Chapter 3 of Part 4, but with one important modification: the requirement that the individual must not be a limited partner at any time during the tax year is disregarded.
• An agreement is treated as related to a licence if both the agreement and the licence are entered into under the same arrangement, regardless of when either was actually entered into.
• A contract or part of a contract is not prevented from being a licence simply because it imposes an obligation to do something, rather than merely granting permission to do it.
• References to exploiting a licence throughout sections 805 to 808 should be understood in that broader sense, encompassing both permissions and obligations.