Tax Laws Amendment (Taxation of Financial Arrangements) Act 2009 (15 of 2009)

Schedule 1   Amendments

Part 2   Consequential amendments

Income Tax Assessment Act 1997

85   After subsection 701-55(5)

Insert:

Division 230 (financial arrangements)

(5A) If Division 230 is to apply in relation to the asset, the expression means that the Division applies as if the asset were acquired at the particular time for a payment equal to:

(a) unless paragraph (b) applies - the asset’s *tax cost setting amount; or

(b) if the asset’s tax cost is set because an entity becomes a *subsidiary member of a *consolidated group, and Subdivision 230-C (fair value method), Subdivision 230-D (foreign exchange retranslation method) or Subdivision 230-F (reliance on financial reports method) is to apply in relation to the asset - the asset’s *Division 230 starting value at the particular time.

(5B) To avoid doubt, for the purposes of paragraph (5A)(b), determine the asset’s *Division 230 starting value by reference to the relevant standards (as mentioned in section 230-230, 230-280 or 230-420) that apply in relation to the *head company’s financial report for the income year in which the entity becomes a subsidiary member of the group.