Income Tax Assessment Act 1997



Division 165 - Income tax consequences of changing ownership or control of a company  

Subdivision 165-B - Working out the taxable income and tax loss for the income year of the change  

When a company must work out its taxable income and tax loss under this Subdivision

SECTION 165-40   On a change of control of the voting power in the company, unless the company satisfies the business continuity test  

A company must calculate its taxable income and tax loss under this Subdivision if, during the income year, a person begins to control, or becomes able to control, the voting power in the company (whether directly, or indirectly through one or more interposed entities) for the purpose, or for purposes including the purpose, of:

(a) getting some benefit or advantage in relation to how this Act applies; or

(b) getting such a benefit or advantage for someone else.

Note 1:

A person can still control the voting power in a company that is in liquidation etc.:see section 165-250 .

Note 2:

Subdivision 167-B has special rules for working out voting power in a company whose shares do not all carry the same voting rights, or do not carry all of the voting rights in the company.


However, that person ' s control of the voting power, or ability to control it, does not require the company to calculate its taxable income under this Subdivision if the company satisfies the *business continuity test for the rest of the income year (the business continuity test period ).


Apply the business continuity test to the *business that the company carried on immediately before the time (the test time ) when the person began to control that voting power, or became able to control it.

For the business continuity test: see Subdivision 165-E .

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