Income Tax Assessment Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-90 - CONSOLIDATED GROUPS  

Division 709 - Other rules applying when entities become subsidiary members etc.  

Subdivision 709-B - Imputation issues  

Operative provisions

SECTION 709-170  

709-170   Head company and subsidiary are exempting entities  

There is no change to the status of the ^* head company of a ^* consolidated group if:

(a) the head company is an ^* exempting entity; and

(b) a ^* corporate tax entity becomes a ^* subsidiary member of the group at a time (also the joining time ); and

(c) the entity is an exempting entity at the joining time.

Note 1:

If the subsidiary ' s franking account is in surplus, that surplus will be transferred to the head company ' s franking account: see subsection 709-60(2) .

Note 2:

If the subsidiary ' s franking account is in deficit, it will be liable for franking deficit tax: see subsection 709-60(3) .

Note 3:

The subsidiary ' s franking account does not operate while it is a member of the group: see section 709-65 .