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DB 11: Negative base price adjustment
or “Calculating tax deductions for financial arrangements with negative outcomes”
You could also call this:

“Deductions allowed for specific old financial arrangements”

You can get a deduction for certain amounts related to old financial arrangements. These amounts are specified in sections EZ 37(6), EZ 38(3), and EZ 38(4) of the Income Tax Act 2007. These sections deal with cash basis holders and situations where a financial arrangement is redeemed or disposed of.

This rule is an addition to the general permission for deductions. It also overrides any general limitations that might prevent you from claiming the deduction. This means that even if other rules might stop you from getting a deduction, this specific rule allows it for these particular financial arrangement situations.

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Next up: DB 13: Repayment of debt in certain circumstances

or “When someone pays off your debt, you may be able to claim a tax deduction”
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Part D Deductions
Specific rules for expenditure types

DB 12Base price adjustment under old financial arrangements rules

  1. A person is allowed a deduction for an amount that is a deduction under section EZ 37(6) (Cash basis holder) or EZ 38(3) or (4) (Income and expenditure where financial arrangement redeemed or disposed of).

  2. This section supplements the general permission and overrides all the general limitations.

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