Income Tax Assessment Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-90 - CONSOLIDATED GROUPS  

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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 707 - Losses for head companies when entities become members etc.  

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Div 707 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 ).

Subdivision 707-A - Transfer of losses to head company  

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Subdiv 707-A heading substituted by No 88 of 2013, s 3 and Sch 6 item 28, effective 29 June 2013. The heading formerly read:

Subdivision 707-A - Transfer of previously unutilised losses to head company

Subdiv 707-A 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 ).

SECTION 707-105   Who can utilise the loss?  

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707-105(1)    
If the loss is transferred, the head company is treated for income years ending after the transfer as having made the loss, so the head company can utilise the loss for those income years to the extent permitted by:

(a) the general rules (outside this Part) about an entity utilising a loss it has made; and

(b) the special rules about transferred losses in the other Subdivisions of this Division that supplement and modify those general rules.

Note:

If the entity from which the loss was transferred became a subsidiary member of the consolidated group, the entity cannot utilise the loss for those income years because of section 701-1 (single entity rule) and section 707-140 .

707-105(2)    
If the loss is not transferred, then, for an income year ending after the time the entity became a member of the consolidated group, the loss cannot be utilised by any entity.

Note:

The loss will not be transferred if the entity would not have been able to utilise it or if the transfer is cancelled under section 707-145 .

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History

S 707-105 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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