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-A - Franking accounts  

Payment of group liability by former subsidiary member

SECTION 709-95   Payment of group liability by former subsidiary member  

709-95(1)    
This section operates if:

(a) an entity (the former subsidiary ) ceases to be a ^* subsidiary member of a ^* consolidated group (the old group ) at a particular time (the leaving time ); and

(b) at or after the leaving time, the former subsidiary:

(i) ^* pays a PAYG instalment for which it was jointly and severally liable under subsection 721-15(1) because it was a subsidiary member of the old group; or

(ii) ^* pays income tax for which it was jointly and severally liable under that subsection because it was a subsidiary member of the old group; and

(c) apart from this section, a ^* franking credit would arise under section 205-15 in the ^* franking account of the former subsidiary at a time (the crediting time ) because of that payment.

709-95(2)    
The credit:

(a) does not arise at the crediting time in the ^* franking account of the former subsidiary; and

(b) instead, arises at the crediting time in the franking account of the entity that was the ^* head company of the old group at the leaving time.