Income Tax Assessment Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-90 - CONSOLIDATED GROUPS  

Division 719 - MEC groups  

Subdivision 719-F - Losses  

Bundles of losses and their available fractions

SECTION 719-305   Subdivision 707-C affects utilisation of losses made by ongoing head company while it was head company  

719-305(1)  
For income years ending after the application event happened, Subdivision 707-C affects the * utilisation of all losses (the prior group losses ) of any * sort that the ongoing head company made (apart from Subdivision 707-A ) for an income year that:


(a) was an income year during which the * MEC group was in existence (or, if the application event involved the MEC group coming into existence because of a * special conversion event involving a * consolidated group, the consolidated group was in existence); and


(b) was before the income year in which the event happened. Prior group losses taken to have been transferred at time of event

719-305(2)  
The ongoing head company is taken to have transferred the prior group losses to itself under Subdivision 707-A at the time of the application event, for the purposes of:


(a) the application of Subdivision 707-C in relation to the * utilisation of the prior group losses and other losses; and


(b) future applications of this section and section 719-310 . Available fraction for bundle of losses

719-305(3)  
For the purpose of working out the * available fraction for the * bundle of the prior group losses at the time of the transfer, work out the ongoing head company's * modified market value at the time of the application event as if:


(a) the ongoing head company had become a * member of a * consolidated group at the time; and


(b) each * subsidiary member of the MEC group or consolidated group of which the ongoing head company was the * head company just before the event were a part of the ongoing head company (and not a separate entity) at the time of the event; and


(c) each subsidiary member of that group at an earlier time had been a part of the ongoing head company (and not a separate entity) at the earlier time. Deemed transfer does not affect year of loss

719-305(4)  
Subdivision 707-C affects the * utilisation as if each of the prior group losses had been made by the ongoing head company for the income year for which the company actually made the loss (and not the income year in which the application event happened). Subsection (2) has effect subject to this subsection.


 

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