Tax Laws Amendment (Loss Recoupment Rules and Other Measures) Act 2005 (147 of 2005)

Schedule 1   Loss recoupment rules for companies etc.

Income Tax Assessment Act 1997

172   Application of items relating to the same business test

 

(1) The amendments made by items 19, 60, 74, 76, 133 and 164 of this Schedule (other than sections 165-212D and 165-212E of the Income Tax Assessment Act 1997 as inserted by item 76) apply in respect of:

(a) any tax loss that is incurred in an income year commencing on or after 1 July 2005; and

(b) any net capital loss that is made in an income year commencing on or after 1 July 2005; and

(c) any deduction in respect of a bad debt that is incurred in an income year commencing on or after 1 July 2005.

Exceptions

      

(2) However, the amendments made by the items mentioned in subitem (1) do not apply to:

(a) a loss that is incurred by a head company in an income year commencing on or after 1 July 2005 because of the operation of section 707-140 of the Income Tax Assessment Act 1997 if the loss was actually incurred by the joining entity or another entity in an income year commencing before that date; or

(b) any tax loss or net capital loss, incurred or made in an income year commencing on or after 1 July 2005, but only to the extent that it would be taken to be a tax loss or net capital loss of the company for an earlier income year under subsection 165-115B(1) or (2) of the Income Tax Assessment Act 1997 if:

(i) the day before the start of that year were a changeover time for the purposes of Subdivision 165-CC of that Act; and

(ii) no changeover time actually occurred after that time.

Note: Section 707-140 of the Income Tax Assessment Act 1997 is about the effect of transferring a loss from a joining entity to a head company of a consolidated group.