Income Tax Assessment Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-90 - CONSOLIDATED GROUPS  

Division 713 - Rules for particular kinds of entities  

Subdivision 713-M - General insurance companies  

Liabilities and reserves of general insurance companies joining and leaving consolidated groups

SECTION 713-725   Treatment of certain assets and liabilities of general insurance companies  

713-725(1)    
This section applies if a *general insurance company becomes or ceases to be a *subsidiary member of a *consolidated group.

713-725(2)    
If the *general insurance company becomes a *subsidiary member of the group:


(a) in working out the step 2 amount for the purposes of the table in section 705-60 , reduce that amount by the sum of the amount of each thing mentioned in subsection (4); and


(b) in working out the *tax cost setting amount of a thing mentioned in subsection (4) for the purposes of section 705-35 , treat the *market value of the thing as zero.

713-725(3)    
If the *general insurance company ceases to be a *subsidiary member of the group:


(a) in working out the step 4 amount for the purposes of the table in section 711-20 , reduce that amount by the sum of the amount of each thing mentioned in subsection (4); and


(b) for the purposes of section 711-25 , treat the *terminating value of a thing mentioned in subsection (4) as zero.

713-725(4)    
The things are the *general insurance company's:


(a) deferred acquisition costs in relation to the company's unearned premium reserve; and


(b) deferred reinsurance expenses in relation to the company's unearned premium reserve; and


(c) recoveries receivable in relation to the company's *outstanding claims.


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