Section 51AK — Income Tax Assessment Act 1936: Agreements for the provision of non-deductible non-cash business benefits

(1) Subject to this section, where: (a) under an agreement: (i) a taxpayer incurs expenditure; and (ii) a non-cash business benefit is provided to the taxpayer or another person; and (b) that benefit is not exclusively for use or application for the purpose of producing assessable income of the taxpayer; the taxpayer shall be treated, for the purposes of this Act, as if so much of the expenditure as does not exceed the arm’s length value of the benefit had been incurred by the taxpayer exclusively in respect of that benefit. (2) This section does not apply so as to treat particular expenditure, or the cost of particular property, to be a particular amount for a particular purpose if there is another provision of this Act that deems that expenditure, or the cost of that property, to be a lesser amount for that purpose. (3) A reference in this section to producing assessable income includes a reference to: (a) gaining assessable income; or (b) carrying on a business for the purpose of gaining or producing assessable income. (4) Expressions used in this section and in section 21A have the same respective meanings in this section as they have in that section. (5) In this section: agreement means any agreement, arrangement or understanding, whether formal or informal, whether express or implied and whether or not enforceable, or intended to be enforceable, by legal proceedings. expenditure includes a loss or outgoing.