Income Tax Assessment Act 1997
View history note
Hide history noteSECTION 705-115 If head company becomes entitled to certain deductions - step 7 in working out allocable cost amount 705-115(1)
For the purposes of step 7 in the table in section 705-60 , the step 7 amount is worked out using the following formula:
| Owned
deductions |
+ [ Acquired deductions × *Corporate tax rate ] |
where:
acquired deductions
means all deductions covered by subsection (2) that are not owned deductions.
owned deductions
means the sum of all deductions for which the following requirements are satisfied:
(a) the deduction is covered by subsection (2);
(b) assuming the expenditure that gave rise to the deduction were instead a profit that accrued at the time the expenditure was incurred, a distribution of that profit would have been a distribution made to the joined group out of profits that accrued to the joined group before the joining time (see subsection 705-90(7) ).
705-115(2)
This subsection covers any deduction to which the * head company becomes entitled under section 701-5 as a result of the joining entity becoming a * subsidiary member of the joined group, other than a deduction for expenditure:
(a) that is, forms part of or reduces, the cost of an asset of the joining entity that becomes an asset of the head company because subsection 701-1(1) (the single entity rule) applies; or
(b) to which section 110-40 (about expenditure on assets acquired before 7.30 pm on 13 May 1997) applies; or
(c) to the extent that the expenditure reduced the undistributed profits comprising the step 3 amount in the table in section 705-60 .
705-115(3)
Subsection (2) does not cover a deduction under section 43-15 (which relates to *undeducted construction expenditure) if the joining entity *acquired the asset to which the deduction relates at or before 7.30 pm, by legal time in the Australian Capital Territory, on 13 May 1997.
Disclaimer and notice of copyright applicable to materials provided by CCH Australia Limited
CCH Australia Limited ("CCH") believes that all information which it has provided in this site is accurate and reliable, but gives no warranty of accuracy or reliability of such information to the reader or any third party. The information provided by CCH is not legal or professional advice. To the extent permitted by law, no responsibility for damages or loss arising in any way out of or in connection with or incidental to any errors or omissions in any information provided is accepted by CCH or by persons involved in the preparation and provision of the information, whether arising from negligence or otherwise, from the use of or results obtained from information supplied by CCH.
The information provided by CCH includes history notes and other value-added features which are subject to CCH copyright. No CCH material may be copied, reproduced, republished, uploaded, posted, transmitted, or distributed in any way, except that you may download one copy for your personal use only, provided you keep intact all copyright and other proprietary notices. In particular, the reproduction of any part of the information for sale or incorporation in any product intended for sale is prohibited without CCH's prior consent.
