Income Tax (Transitional Provisions) Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-90 - CONSOLIDATED GROUPS  

Division 701D - Transitional foreign loss makers  

Subdivision 701D-A - Object of this Division  

SECTION 701D-1   Object of this Division  

701D-1(1)    

The object of this Division is to allow an entity that is a potential subsidiary member of a consolidated group to utilise an overall foreign loss (as defined in former section 160AFD of the Income Tax Assessment Act 1936 ) during a transitional period, rather than have the head company utilise the loss subject to the restrictions in Subdivision 707-C of the Income Tax Assessment Act 1997 .

701D-1(2)    
Therefore, this Division allows the head company to prevent the entity from being a subsidiary member of the group, for a transitional period.