Taxation Ruling

TR 2004/14A2 - Addendum

Income tax: consolidation: recognising and measuring the liabilities of a joining entity under subsection 705-70(1) of the Income Tax Assessment Act 1997 where the entity becomes a subsidiary member of a consolidated group in a financial reporting period of the entity not beginning on or after 1 January 2005

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Addendum

This Addendum amends Taxation Ruling TR 2004/14 to take into account the changes introduced by Schedule 5 to the Tax Laws Amendment (2010 Measures No. 1) Act 2010.

TR 2004/14 is amended as follows:

1. Paragraph 53

Omit from the last dot point 'and the potential application of CGT event L7 in dealing with linked liabilities'.

2. Paragraph 65

Omit the last two sentences; substitute:

CGT event L7 is applicable where certain liabilities are taken into account in working out the ACA, but those liabilities are then later discharged for a higher realised amount. Capital losses may result in these circumstances where the liability is discharged by the head company on or after 1 July 2002 and before 10 February 2010.

This Addendum applies on and after 1 July 2002, the date of application of the amendments to the Income Tax Assessment Act 1997 made by Part 12 of Schedule 5 to Tax Laws Amendment (2010 Measures No. 1) Act 2010.

Commissioner of Taxation
29 June 2011

References

ATO references:
NO 1-23WCB9I