Income Tax Assessment Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES

PART 3-5 - CORPORATE TAXPAYERS AND CORPORATE DISTRIBUTIONS

Division 175 - Use of a company ' s tax losses or deductions to avoid income tax

Subdivision 175-B - Tax benefits from unused deductions

SECTION 175-35 Tax loss resulting from disallowed deductions

175-35(1)

If a company has a taxable income for an income year because the Commissioner disallows under this Subdivision deductions of the company for the income year (or parts of them), the company may also have a *tax loss for the income year.

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175-35(2)
The company's tax loss for the income year is calculated as follows.

175-35(3)
Total what the Commissioner has disallowed under this Subdivision.

175-35(4)

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If the company has *exempt income for the income year, subtract its * net exempt income .

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175-35(5)
Any amount remaining is the company's tax loss for the income year, which is called a loss year .

Note:

The meanings of tax loss and loss year are modified by section 36-55 for a corporate tax entity that has an amount of excess franking offsets.

To find out how much of the tax loss can be deducted in later income years: see Subdivision 165-A .

To find out how to deduct it: see section 36-17 .

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