New Business Tax System (Consolidation, Value Shifting, Demergers and Other Measures) Act 2002 (90 of 2002)

Schedule 2   Consolidation: miscellaneous changes to asset cost provisions

Income Tax Assessment Act 1997

23   After subsection 705-65(5)

Insert:

Reduction in reduced cost base under subsection 165-115ZA(3) to be added back

(5A) If:

(a) in working out the*reduced cost base of the*membership interest for the purposes of subsection (1), a reduction has taken place under subsection 165-115ZA(3) (about alterations in ownership or control of loss companies); and

(b) the reduction is to some extent attributable to so much of an amount that was taken into account both in working out the amount of the reduction and in working out:

(i) the step 5 amount under section 705-100; or

(ii) the step 6 amount under section 705-110;

the reduced cost base is, to the extent mentioned in paragraph (b), increased by:

(c) if subparagraph (b)(i) applies - the amount of that reduction; or

(d) if subparagraph (b)(ii) applies - the amount of that reduction multiplied by the*general company tax rate.