INCOME TAX ASSESSMENT ACT 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-90 - CONSOLIDATED GROUPS  

Division 709 - Other rules applying when entities become subsidiary members etc.  

Subdivision 709-A - Franking accounts  

Payment of group liability by former subsidiary member

SECTION 709-95   Payment of group liability by former subsidiary member  

709-95(1)  
This section operates if:


(a) an entity (the former subsidiary ) ceases to be a * subsidiary member of a * consolidated group (the old group ) at a particular time (the leaving time ); and


(b) at or after the leaving time, the former subsidiary:


(i) * pays a PAYG instalment for which it was jointly and severally liable under subsection 721-15(1) because it was a subsidiary member of the old group; or

(ii) * pays income tax for which it was jointly and severally liable under that subsection because it was a subsidiary member of the old group; and


(c) apart from this section, a * franking credit would arise under section 205-15 in the * franking account of the former subsidiary at a time (the crediting time ) because of that payment.

709-95(2)  
The credit:


(a) does not arise at the crediting time in the * franking account of the former subsidiary; and


(b) instead, arises at the crediting time in the franking account of the entity that was the * head company of the old group at the leaving time.


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