Income Tax Assessment Act 1997



Division 703 - Consolidated groups and their members  

Effects of choice to continue group after shelf company becomes new head company  

SECTION 703-70   Consolidated group continues in existence with interposed company as head company and original entity as a subsidiary member  


The * consolidated group is taken not to have ceased to exist under subsection 703-5(2) because the company referred to in subsection 615-30(2) as the original entity ceases to be the * head company of the group.


To avoid doubt, the interposed company is taken to have become the * head company of the * consolidated group at the completion time, and the original entity is taken to have ceased to be the head company at that time.

A further result is that the original entity is taken to have become a subsidiary member of the group at that time. Section 703-80 deals with the original entity ' s tax position for the income year that includes the completion time.

A provision of this Part that applies on an entity becoming a * subsidiary member of a * consolidated group does not apply to an entity being taken to have become such a member as a result of this section, unless the provision is expressed to apply despite this subsection.


An example of the effect of this subsection is that there is no resetting under section 701-10 of the tax cost of assets of the original entity that become assets of the interposed company because of subsection 701-1(1) (the single entity rule).

To avoid doubt, subsection (3) does not affect the application of subsection 701-1(1) (the single entity rule).


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