INCOME TAX ASSESSMENT ACT 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-5 - CORPORATE TAXPAYERS AND CORPORATE DISTRIBUTIONS  

Division 170 - Treatment of certain company groups for income tax purposes  

Subdivision 170-B - Transfer of net capital losses within certain wholly-owned groups of companies  

Effect of transferring a net capital loss

SECTION 170-115   Who can apply transferred loss  

170-115(1)  


If an amount of a *net capital loss is transferred, the gain company can apply the amount in working out its *net capital gain, but only for the income year of the gain company for which the amount is transferred. That income year is called the application year .
Note:

A company ' s net capital gain or net capital loss for an income year is usually worked out under section 102-5 or 102-10 .

170-115(2)  


The loss company can no longer * utilise the transferred amount and is taken not to have made the *net capital loss to the extent of that amount.

170-115(3)  


Despite subsection (1), if the *net capital loss is transferred because the conditions in section 170-132 are met, the gain company is taken to have made the net capital loss for the income year for which the first prior transferor mentioned in that section made the net capital loss.

170-115(4)  


Despite subsection (1), if the *net capital loss is transferred because the condition in subsection 170-142(4) is met, the gain company is taken to have made the net capital loss for the income year for which that subsection assumes the gain company made the net capital loss.

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