Income Tax (Transitional Provisions) Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-90 - CONSOLIDATED GROUPS  

Division 701 - Modified application of provisions of Income Tax Assessment Act 1997 for certain consolidated groups formed in 2002-03 and 2003-04 financial years  

Subdivision 701-B - Modified application of provisions  

SECTION 701-45   When entity leaves transitional group, head company may choose, for purposes of transitional group's allocable cost amount, to use formation time market values, instead of terminating values, for certain pre-CGT assets  

701-45(1)    
This section applies if:


(a) an entity ceases to be a subsidiary member of the transitional group; and


(b) just before the transitional group came into existence, the entity that became the head company held a pre-CGT asset; and


(c) that holding of the asset did not occur as a result of a CGT event:


(i) for which there was a roll-over under Subdivision 126-B of the Income Tax Assessment Act 1997 ; and

(ii) that occurred after 11.45 am by legal time in the Australian Capital Territory on 21 September 1999; and


(d) just before the entity ceases to be a subsidiary member of the group, the asset is still a pre-CGT asset and is held by the head company only because the entity is taken by subsection 701-1(1) (the single entity rule) of the Income Tax Assessment Act 1997 to be a part of the head company.

701-45(2)    
If this section applies, the head company may, in relation to the entity's ceasing to be a subsidiary member, choose that the terminating value for the asset, that is to be used in applying step 1 of the table in section 711-20 of the Income Tax Assessment Act 1997 , is equal to its market value just before the transitional group came into existence.



This information is provided by CCH Australia Limited Link opens in new window. View the disclaimer and notice of copyright.