Income Tax Assessment Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-1 - CAPITAL GAINS AND LOSSES: GENERAL TOPICS  

Division 104 - CGT events  

Subdivision 104-L - Consolidated groups and MEC groups  

SECTION 104-505   Where pre-formation intra-group roll-over reduction results in negative allocable cost amount: CGT event L2  

104-505(1)    
CGT event L2 happens if:

(a) an entity becomes a *subsidiary member of a *consolidated group or a *MEC group; and

(b) in working out the group ' s *allocable cost amount for the entity, the amount remaining after applying step 3A of the table in section 705-60 is negative.

104-505(2)    
The time of the event is just after the entity becomes a *subsidiary member of the group.

104-505(3)    
For the head company core purposes mentioned in subsection 701-1(2) , the *head company makes a capital gain equal to the amount remaining.