Income Tax Assessment (Methods for Valuing Unlisted Shares) Approval 2015 (Cth)

Legislative Instrument

Income Tax Assessment (Methods for Valuing Unlisted Shares) Approval 2015

I, Stephen John Vesperman, Deputy Commissioner of Taxation, make this approval under subsection 960-412(2) of the Income Tax Assessment Act 1997

Stephen John Vesperman Deputy Commissioner of Taxation Dated 23 June 2015

1. Name of Approval

This approval is the Income Tax Assessment (Methods for Valuing Unlisted Shares) Approval 2015.

2. Commencement

This approval commences on 1 July 2015, or on the commencement of the Tax and Superannuation Laws Amendment (Employee Share Schemes) Act 2015, whichever is the later.

3. Scope of approval

The methods set out in clause 5 may be used only in working out the value of unlisted ordinary shares for the purposes of subsection 83A-33(5) of the Income Tax Assessment Act 1997 as at the time when the relevant ESS interests are acquired (in this approval called the valuation time).

4. Who is covered by this approval

This approval applies to a company that:

(a) issues an ESS interest mentioned in subsection 83A-33(1) of the Income Tax Assessment Act 1997; and

(b) reasonably anticipates that there will not be a change of control of the company occurring within the period ending 6 months after the valuation time.

5. Approved Methods for Valuing Unlisted Ordinary Shares

Method 1

(1) For a company that:

(a) has not raised capital of more than $10 million during the period of 12 months immediately before the valuation time; and

(b) at the valuation time, either:

(i) has been incorporated for not more than 7 years; or

(ii) is a small business entity within the meaning of section 328-110 of the Income Tax Assessment Act 1997; and