INCOME TAX ASSESSMENT ACT 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-90 - CONSOLIDATED GROUPS  

Division 715 - Interactions between this Part and other areas of the income tax law  

Subdivision 715-F - Interactions with Division 230 (financial arrangements)  

SECTION 715-375   Cost setting - amount of liability that is Division 230 financial arrangement  

715-375(1)  
Subsection (2) applies if:


(a) an entity (the joining entity ) becomes a *subsidiary member of a *consolidated group at a time (the joining time ); and


(b) a thing (the accounting liability ) is, in accordance with *accounting standards, or statements of accounting concepts made by the Australian Accounting Standards Board, a liability of the joining entity at the joining time (disregarding subsection 701-1(1) (the single entity rule)) that can or must be recognised in the entity's statement of financial position; and


(c) the accounting liability is or is part of a *Division 230 financial arrangement of the head company at the joining time (because of subsection 701-1(1) (the single entity rule)).

715-375(2)  


For the purposes of Division 230 and Schedule 1 to the Tax Laws Amendment (Taxation of Financial Arrangements) Act 2009, treat the *head company of the group as starting to have the accounting liability at the joining time for receiving a payment equal to:


(a) if the liability is or is part of a *Division 230 financial arrangement of the head company at the joining time (because of subsection 701-1(1) (the single entity rule)):


(i) to which Subdivision 230-B (accruals method or realisation method) applies; or

(ii) to which Subdivision 230-E (hedging financial arrangements method) applies;
the amount of the liability, as determined in accordance with:

(iii) the joining entity's *accounting principles for tax cost setting; or

(iv) if the amount of the liability cannot be determined in accordance with the joining entity's accounting principles for tax cost setting - comparable standards for accounting made under a *foreign law; or


(b) otherwise - the liability's *Division 230 starting value at the joining time.

715-375(3)  
(Repealed by No 99 of 2012)

715-375(4)  
(Repealed by No 99 of 2012)


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