Tax Laws Amendment (2004 Measures No. 2) Act 2004 (83 of 2004)
Schedule 2 Consolidation etc.
Part 4 Cost setting for assets that the head company does not hold under the single entity rule
Income Tax Assessment Act 1997
13 After section 701-55
701-58 Effect of setting the tax cost of an asset that the head company does not hold under the single entity rule
(1) This section applies if:
(a) the *tax cost of an asset was set at the time (the joining time ) an entity became a *subsidiary member of a *consolidated group, at the asset's *tax cost setting amount; and
(b) ignoring the operation of subsection 701-1(1) (the single entity rule), the entity held the asset at the joining time; and
(c) taking into account the operation of subsection 701-1(1) (the single entity rule), the *head company of the group did not hold the asset at the joining time.
Example: A debt owed by a member of the group to the joining entity at the joining time.
(2) To avoid doubt, the asset's *tax cost setting amount mentioned in paragraph (1)(a) is not to be taken into account in applying the provisions mentioned in subsections 701-55(2), (3), (4), (5) and (6) in relation to the asset at and after the joining time.