CHAPTER 3
-
SPECIALIST LIABILITY RULES
PART 3-90
-
CONSOLIDATED GROUPS
History
Part 3-90 inserted by No 68 of 2002, s 3 and Sch 1 item 2, effective 24 October 2002 and applicable on and after 1 July 2002 (see sec
700-1
of the
Income Tax (Transitional Provisions) Act 1997
).
Division 701
-
Core rules
History
Div 701 inserted by No 68 of 2002, s 3 and Sch 1 item 2, effective 24 October 2002 and applicable on and after 1 July 2002 (see sec
700-1
of the
Income Tax (Transitional Provisions) Act 1997
).
Entity rules
SECTION 701-40
Exit history rule
701-40(1)
If the entity ceases to be a
*
subsidiary member of the group, this section has effect for the entity core purposes, so far as they relate to any thing covered by subsection (2) (an
eligible asset etc.
) after it becomes that of the entity because subsection
701-1(1)
(the single entity rule) ceases to apply to the entity.
History
S 701-40(1) amended by No 93 of 2011, s 3 and Sch 3 item 102, by repealing the note, effective 8 September 2011. For application, savings and transitional provisions see note under Div
355
heading. The note formerly read:
Note:
Section 73BAD of the
Income Tax Assessment Act 1936
overrides this rule for the purposes of the research and development incremental expenditure provisions.
S 701-40(1) note inserted by No 117 of 2002, s 3 and Sch 11 item 10, effective 24 October 2002 and applicable on and after 1 July 2002 (see sec
700-1
of the
Income Tax (Transitional Provisions) Act 1997
).
Assets, liabilities and businesses covered
701-40(2)
This subsection covers the following:
(a)
any asset;
(b)
any liability or other thing that, in accordance with
*
accounting principles, is a liability;
(c)
any business;
(d)
(Repealed by No 93 of 2011)
that becomes that of the entity because subsection
701-1(1)
(the single entity rule) ceases to apply to the entity when it ceases to be a
*
subsidiary member of the group.
History
S 701-40(2) amended by No 93 of 2011, s 3 and Sch 3 item 103, by repealing para (d), effective 8 September 2011. For application, savings and transitional provisions see note under Div
355
heading. Para (d) formerly read:
(d)
any registration under section 39J of the
Industry Research and Development Act 1986
for particular research and development activities;
S 701-40(2) amended by No 56 of 2010, s 3 and Sch 5 item 90, by substituting
"
*accounting principles
"
for
"
*accounting standards, or statements of accounting concepts made by the Australian Accounting Standards Board
"
in para (b), applicable on and after 10 February 2010.
S 701-40(2)(d) inserted by No 117 of 2002, s 3 and Sch 11 item 11, effective 24 October 2002 and applicable on and after 1 July 2002 (see sec
700-1
of the
Income Tax (Transitional Provisions) Act 1997
).
Head company history inherited
701-40(3)
Everything that happened in relation to any eligible asset etc. while it was that of the
*
head company, including because of any application of section
701-5
(the entry history rule), is taken to have happened in relation to it as if it had been an eligible asset etc. of the entity.
Note 1:
If the eligible asset etc. was brought into the group when an entity became a subsidiary member, section
701-5
(the entry history rule) would have had the effect that things happening to the eligible asset etc. while it was that of the entity would be taken to have happened as if it was that of the head company. Such things will in turn be taken by this subsection to have happened in relation to the eligible asset etc. as if it were that of the entity that takes the asset out of the group.
Note 2:
Other provisions of this Part may affect the tax history that is inherited (e.g. asset cost base history is affected by section
701-45
).
History
S 701-40 inserted by No 68 of 2002, s 3 and Sch 1 item 2, effective 24 October 2002 and applicable on and after 1 July 2002 (see sec
700-1
of the
Income Tax (Transitional Provisions) Act 1997
).
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