Income Tax Assessment Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-90 - CONSOLIDATED GROUPS  

Division 701 - Core rules  

Supporting provisions  

SECTION 701-60A   Tax cost setting amount for asset emerging when entity leaves group  

701-60A(1)    
This section applies for the purpose of working out the *tax cost setting amount of an asset if:


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


(b) the asset ' s tax cost is set under section 701-45 because it consists of a liability (the corresponding liability ) owed to the leaving entity.

701-60A(2)    
The *tax cost setting amount is:


(a) unless subsection (3) or (4) applies - the *market value of the asset at the leaving time; or


(b) if subsection (3) applies - nil; or


(c) if subsection (4) applies - the least of the following amounts:


(i) the tax cost setting amount mentioned in paragraph (4)(c);

(ii) if the *head company of the old group was entitled to a deduction in respect of the asset for an income year ending on or before the leaving time - the tax cost setting amount mentioned in paragraph (4)(c) reduced by the amount of the deduction;

(iii) the market value of the asset at the leaving time.

701-60A(3)    
This subsection applies if:


(a) the corresponding liability is not a debt; and


(b) either:


(i) at the time the corresponding liability arose, the entity to whom the corresponding liability was owed and the entity owing the corresponding liability were both *members of the old group; or

(ii) if subparagraph (i) does not apply - after the time the corresponding liability arose, a member of the old group *acquired the asset or started to have the corresponding liability.

701-60A(4)    
This subsection applies if:


(a) the corresponding liability is not a debt; and


(b) at the time the corresponding liability arose, the entity to whom the corresponding liability was owed and the entity owing the corresponding liability were not both members of the old group; and


(c) the *tax cost of the asset was set under section 701-10 at the time an entity became a *subsidiary member of the old group, at the asset ' s *tax cost setting amount (whether or not section 701-58 applied in relation to the setting of that tax cost).


 

Disclaimer and notice of copyright applicable to materials provided by CCH Australia Limited

CCH Australia Limited ("CCH") believes that all information which it has provided in this site is accurate and reliable, but gives no warranty of accuracy or reliability of such information to the reader or any third party. The information provided by CCH is not legal or professional advice. To the extent permitted by law, no responsibility for damages or loss arising in any way out of or in connection with or incidental to any errors or omissions in any information provided is accepted by CCH or by persons involved in the preparation and provision of the information, whether arising from negligence or otherwise, from the use of or results obtained from information supplied by CCH.

The information provided by CCH includes history notes and other value-added features which are subject to CCH copyright. No CCH material may be copied, reproduced, republished, uploaded, posted, transmitted, or distributed in any way, except that you may download one copy for your personal use only, provided you keep intact all copyright and other proprietary notices. In particular, the reproduction of any part of the information for sale or incorporation in any product intended for sale is prohibited without CCH's prior consent.