INCOME TAX ASSESSMENT ACT 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-90 - CONSOLIDATED GROUPS  

Division 707 - Losses for head companies when entities become members etc.  

Subdivision 707-A - Transfer of losses to head company  

Transfer of loss from joining entity to head company

SECTION 707-135   Transferring loss transferred to joining entity because business continuity test was satisfied  

707-135(1)  


This section operates if the loss had been transferred to the joining entity (by a previous operation of this Subdivision) because the entity from which the loss was transferred carried on during a particular period:


(a) the same business as it carried on at a particular time; or


(b) if section 165-211 applies in relation to the loss - a business similar to the business it carried on at a particular time.

Note:

Section 165-211 enables an entity to satisfy the business continuity test by carrying on a similar business.

707-135(2)  


The loss is not transferred from the joining entity to the * head company of the joined group (despite section 707-120 ), unless the joining entity satisfies the *business continuity test for:


(a) the * trial year (the business continuity test period ); and


(b) the time (the test time ) just before the end of the income year in which the loss was transferred to the joining entity.


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