Section DB 43 — Income Tax Act 2007: Making good loss from misappropriation by partners

DB 43 Making good loss from misappropriation by partners When this section applies (1) This section applies when a person carrying on a business in partnership pays an amount to make good a loss that arises from a partner, other than the person or the person’s spouse, civil union partner, or de facto partner, misappropriating property that— (a) belongs to another person who is neither a partner in the partnership nor the spouse, civil union partner, or de facto partner of a partner; and (b) is received in the course of the business either by the partnership or 1 or more of its partners. Deduction (2) The person is allowed a deduction for the amount if the person is under a legal liability to make good the loss. Timing of deduction (3) The deduction is allocated to the income year in which the amount is paid. Link with subpart DA (4) This section supplements the general permission and overrides the capital limitation. The other general limitations still apply. Defined in this Act: amount , business , capital limitation , deduction , general limitation , general permission , income year , pay , supplement , Compare: 2004 No 35 s DB 34