Income Tax Assessment Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-90 - CONSOLIDATED GROUPS  

Division 705 - Tax cost setting amount for assets where entities become subsidiary members of consolidated groups  

Subdivision 705-A - Basic case: a single entity joining an existing consolidated group  

Tax cost setting amount for assets that joining entity brings into joined group

SECTION 705-30   What is the joining entity ' s terminating value for an asset ?  

Trading stock

705-30(1)    
If an asset of the joining entity is *trading stock, the joining entity ' s terminating value for the asset is:

(a) if the asset was on hand at the start of the income year in which the joining time occurs (including because of the operation of Division 701 ) - its *value at that time; or

(b) if paragraph (a) does not apply and the asset is *live stock that was acquired by natural increase - the *cost of the asset; or

(c) in any other case - the amount of the outgoing incurred by the joining entity in connection with the acquisition of the asset;

increased by the amount of any outgoing forming part of the cost of the asset that is incurred by the joining entity during its current holding of the asset.

Registered emissions units

705-30(1A)    
If an asset of the joining entity is a *registered emissions unit, the joining entity ' s terminating value for the unit is equal to:

(a) if the unit was *held by the joining entity at the start of the income year - the *value of the unit at the start of the income year; or

(b) otherwise - the expenditure incurred by the joining entity in becoming the holder of the unit.

Qualifying securities

705-30(2)    
If an asset of the joining entity is a qualifying security (within the meaning of Division 16E of Part III of the Income Tax Assessment Act 1936 ) that is not *trading stock, the joining entity ' s terminating value for the asset is equal to the amount of consideration that the joining entity would need to receive, if it were to dispose of the asset just before the joining time, without an amount being assessable income of, or deductible to, the joining entity under section 159GS of the Income Tax Assessment Act 1936 .

Depreciating assets

705-30(3)    

If an asset of the joining entity is a *depreciating asset to which Division 40 applies, the joining entity ' s terminating value for the asset is equal to the asset ' s *adjustable value just before the joining time.

Financial arrangements to which Subdivision 250-E applies

705-30(3A)    

If an asset of the joining entity is a *financial arrangement to which Subdivision 250-E applies, the joining entity ' s terminating value for the asset is equal to the amount of consideration that the joining entity would need to receive, if it were to dispose of the asset just before the joining time, without an amount being assessable income of, or deductible to, the joining entity under Subdivision 250-E .

Division 230 financial arrangements

705-30(3B)    

If an asset of the joining entity is or is part of a *Division 230 financial arrangement, the joining entity's terminating value for the asset is equal to the amount of consideration that the joining entity would need to receive, if it were to dispose of the asset just before the joining time, without an amount being assessable income of, or deductible to, the joining entity under Division 230 .

Other CGT assets

705-30(4)    
If an asset of the joining entity is a *CGT asset that is not covered by any of the above subsections, the joining entity ' s terminating value for the asset is equal to the asset ' s *cost base just before the joining time.

Other assets

705-30(5)    
The joining entity ' s terminating value for any other asset that it holds is the amount that would be the asset ' s *cost base just before the joining time if it were an asset covered by subsection (4).