Tax Laws Amendment (2010 Measures No. 1) Act 2010 (56 of 2010)

Schedule 5   Consolidation

Part 16   Loss multiplication rules for widely held companies

Income Tax Assessment Act 1997

148A   After section 715-260

Insert:

715-265 Head company does not have relevant equity or debt interest in a loss company if widely held top company does not have such an interest

(1) For the purposes of Subdivision 165-CD, treat the *head company of a *consolidated group as not having a relevant equity interest in a *loss company at a particular time if:

(a) the head company is an *eligible tier-1 company of a *top company at that time; and

(b) the top company is a *widely held company at that time; and

(c) because of subsections 165-115X(2A), (2B) and (2C), the top company does not have a relevant equity interest under section 165-115X in the loss company at that time.

(2) For the purposes of paragraph (1)(c), disregard the operation of subsection 701-1(1) (the single entity rule) in determining whether subsection 165-115X(2C) has the effect that the *top company has the relevant equity interest mentioned in that paragraph.

(3) For the purposes of Subdivision 165-CD, treat the *head company of a *consolidated group as not having a relevant debt interest in a *loss company at a particular time if:

(a) the head company is an *eligible tier-1 company of a *top company at that time; and

(b) the top company is a *widely held company at that time; and

(c) because of subsections 165-115Y(3A), (3B) and (3C), the top company does not have a relevant debt interest under section 165-115Y in the loss company at that time.


Copyright notice

© Australian Taxation Office for the Commonwealth of Australia

You are free to copy, adapt, modify, transmit and distribute material on this website as you wish (but not in any way that suggests the ATO or the Commonwealth endorses you or any of your services or products).