Overview   How It Works   Tax Rulings  Member Area

Finance   About Us   Property   News    Contact Us

Quick Links

• Taxation Office Product Ruling
• Interest
• Capital Gains
• Anti avoidance provisions
• Stamp Duty
• Goods and Services Tax


Australian Taxation
Office Product Ruling

Please refer to the tax report and tax ruling in the Product Disclosure Statement. or View entire ATO report here.

NOTE: As with any ATO Product Ruling, this is the Tax Office’s ruling on how taxation law applies to QuantumWarrants. It is not a guarantee or endorsement of the commercial viability, investment soundness or fees of a QuantumWarrant. The ruling only applies to products issued exactly as it is described.

Individual Taxation Advice

The following notes relate to the general taxation consequences of investment in QuantumWarrants. They do not consider the circumstances of individual taxpayers. Individual taxpayers are encouraged to consult with their own tax advisers to obtain advice as to the tax consequences to them of investment in QuantumWarrants.

Taxation Office Product Ruling

The observations noticed below (except where otherwise indicated) are supported by Taxation Office Product Ruling PR 2005/27 dated 16 March 2005.
Taxation Office Product Ruling PR 2005/27 is a binding ruling. The ruling applies prospectively from 16 March 2005. The ruling is withdrawn and ceases to have effect after 30 June 2008 (unless withdrawn earlier). So far as relevant the ruling continues to apply in respect of the tax laws ruled upon to all persons who acquired QuantumWarrants between the date of effect of the ruling and the date the ruling was withdrawn. That is the ruling continues to apply to those persons who acquired QuantumWarrants prior to withdrawal of the ruling provided there is no change in the arrangement or those person’s involvement in the arrangement.



(a) All the interest paid by an investor to QuantumWarrants Pty Limited as a consequence of acquiring a QuantumWarrant will be deductible to the Investor in the year incurred;
(b) Subdivision H of Division 3 of the Income Tax Assessment Act 1936 (”ITAA 36”) (which contains the “period of deductibility of certain advance expenditure provisions” of the Act) will not prevent an Investor from claiming a deduction for interest paid yearly in advance to QuantumWarrants Pty Limited as a consequence of the Investor acquiring a QuantumWarrant in the year in which that interest expense was incurred;
(c) Section 51 AAA of ITAA 36 which is a technical provision which disallows deductions to taxpayers where the deduction would only be allowable because a taxpayer had incurred a net or notional capital gain in the taxpayer’s assessable income will not be applicable;
(d) Section 82KL of ITAA 36 that disallows deductions where the amount of a deduction will be “recouped” will not be deductible.


Capital gains

(a) For capital gains tax (“CGT”) purposes including for the purpose of the CGT discount the date of acquisition of a Property is the date on which the Security Trustee entered into a contract for the acquisition of the Property;
(b) No CGT event arises when the legal title to the Property is transferred from the Security Trustee to the Investor on cancellation or redemption of a QuantumWarrant;
(c) A CGT event will arise under section 104-10 of the ITAA 97 to the Investor where a Completion Payment is not made and a Property is sold by QuantumWarrants Pty Limited exercising its power of sale of the Property;
(d) If on sale of an underlying property the sale proceeds are insufficient to allow the Investor to repay the loan made to it by QuantumWarrants Pty Limited given that QuantumWarrants Pty Limited will not be able to recover from the Investor that shortfall the cost of the property will be reduced by the amount of that shortfall in determining whether or not a capital gain was made or capital loss incurred on that sale of the Property;
(e) Any capital gain realised by an Investor on sale of a Property received pursuant to completion of a QuantumWarrant will be treated as a discount capital gain for the purposes of the ITAA 97 where the Investor is an individual, a complying superannuation entity or a trust that owned the QuantumWarrant for at least 12 months.

Annual Income

All the income derived from a Property will be included in the assessable income of the Investor and not the Security Trustee.


Anti avoidance provisions

The anti avoidance provisions contained in Part IVA of ITAA 36 will not apply to an Investor in respect of QuantumWarrants (which means the deduction for any interest paid to QuantumWarrants Pty Limited in respect of a QuantumWarrant will not be denied outright or pro rated by reason of an application of that Part).


Stamp Duty

Although this is not the subject of Product Ruling PR 2005/27 It is our opinion that no stamp duty will be payable as a consequence of the issue or redemption of a QuantumWarrant although stamp duty may be payable where a mortgage is given over Property. Stamp duty will however most probably be payable by the Security Trustee where the Security Trustee purchases a Property.


Goods and Services Tax

Goods and Services tax is also not the subject of Product Ruling PR 2005/27. We are of the opinion that no goods and services tax will be payable as a consequence of the issue or redemption of a QuantumWarrant. Goods and services tax may – depending upon the nature of the Property – be payable by a vendor (and possibly effectively recharged to the Security Trustee) when the Security Trustee purchases a Property.


Quantum Investment Solutions Pty Ltd ACN 120-229-807, AFSL No. 305 605 (Quantum).
© Quantum Warrants    Privacy policy