Income Tax (Transitional Provisions) Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-90 - CONSOLIDATED GROUPS  

Division 701C - Modified application etc. of provisions of Income Tax Assessment Act 1997: transitional foreign-held membership structures  

Subdivision 701C-B - Membership rules allowing foreign holding  

SECTION 701C-15   Additional membership rules where entities are interposed between the head company and a subsidiary member - case where an interposed entity is a foreign resident and the subsidiary member is a trust or partnership  

701C-15(1)    
This section describes, for the purposes of item 2, column 4 of the table in subsection 703-15(2) of the Income Tax Assessment Act 1997 , a set of requirements that must be met for an entity (the test entity ) to be a subsidiary member of a consolidated group or a consolidatable group at a particular time (the test time ).

Note:

This subsection applies in relation to a MEC group as if the reference to item 2, column 4 of the table in subsection 703-15(2) of the Income Tax Assessment Act 1997 were a reference to subparagraph 719-10(1) (b)(iii) of that Act (see subsection 719-2(3) of this Act).

Test entity must be a trust or partnership

701C-15(2)    
At the test time, the test entity must be a trust or partnership.

At least one interposed entity must be a company that is a subsidiary member because of section 701C-10

701C-15(3)    
At the test time, one or more of the interposed entities must be companies that are subsidiary members of the group because the set of requirements in section 701C-10 are met.

Test entity must be a subsidiary member on assumption that head company beneficially owned all membership interests beneficially owned by subsection (3) companies

701C-15(4)    
At the test time, it must be the case that the test entity would be a subsidiary member of the group if the head company beneficially owned all the membership interests beneficially owned by each company described in subsection (3).