New Business Tax System (Consolidation and Other Measures) Act 2003 (16 of 2003)

Schedule 23   Consolidation: research and development

Income Tax Assessment Act 1936

3   After section 73BAF

Insert:

73BAG Balancing adjustments for certain assets of consolidated groups

(1) Subsections 73(23) and (24B) do not apply to an asset held by the head company of a consolidated group or MEC group where the tax cost of the asset is set under Division 701 of the Income Tax Assessment Act 1997. Instead, any balancing adjustment for the asset is worked out under section 73BF of this Act or section 40-292 of the Income Tax Assessment Act 1997.

(2) In working out the amount of a balancing adjustment under section 73BF of this Act or section 40-292 of the Income Tax Assessment Act 1997 for the asset, the asset's adjustable value (see section 40-85 of that Act) is reduced by so much of a reduction amount (see section 73BAF of this Act) for the asset that has not been applied in reducing a notional Division 40 deduction for the head company.