Section DF 5 — Income Tax Act 2007: Government funding additional to government screen production payments

DF 5 Government funding additional to government screen production payments When this section applies (1) This section applies when a public authority makes a payment (the funding payment ) to a person for expenditure incurred in a project if— (a) the funding payment is not in the nature of a grant or subsidy; and (b) the funding payment is not a grant-related suspensory loan; and (c) the person receives a government screen production payment for the project in addition to the funding payment; and (d) the person would be allowed a deduction for the expenditure in the absence of this section; and (e) the payment is excluded income under section CX 48C (Government funding additional to government screen production payments). No deduction for expenditure (2) The person is denied, to the extent of the amount of the funding payment, the deduction for the expenditure that would be allowed in the absence of this section. Deduction for payments to public authority (3) The person is allowed a deduction for the amount of a payment (the return payment ) made to the public authority to the extent to which the return payment is required by the arrangement under which the funding payment is made. Links with subpart DA (4) In this section— (a) subsection (2) overrides the general permission; and (b) subsection (3) supplements the general permission and overrides the capital limitation; the other general limitations still apply. Defined in this Act: capital limitation , deduction , excluded income , general limitation , general permission , government screen production payment , grant-related suspensory loan , pay , public authority Section DF 5: added (with effect on 1 October 2009), on 6 October 2009, by section 89 of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34).