Private ruling: Corporate restructure
Published: November 2013
Ruling period: Income year ending 30 June 20xx
Date scheme commenced: During the income year ending 30 June 20xx

Ruling: Q1: Pursuant to subsection 703-70(1) of the ITAA 1997, will the income tax consolidated group be taken not to have ceased to exist as the company must choose under subsection 124-380(5) of the ITAA 1997 for the income tax consolidated group to continue to exist with the company as the new head company? | A1: Yes. | Q2: Does the Commissioner agree that the company will inherit the trust's identity and tax history for the part of the income year that ends before the completion time? | A2: Yes. | Q3: Will the entity and its Australian wholly owned subsidiaries each become a 'subsidiary member' of the income tax consolidated group pursuant to subsection 703-15(2) of the ITAA 1997 at the time the head company becomes registered as the holder of the ordinary shares by virtue of the application of section 703-33 of the ITAA 1997? | A3: Yes. | Q4: Will the entity and its Australian wholly owned subsidiaries each be taken to be a 'subsidiary member' of the income tax consolidated group for the whole of the day of joining for head company and entity core purposes under section 701-1 of the ITAA 1997? | A4: Yes. | Q5: Does Subdivision 705-C of the ITAA 1997 apply to the entity and its Australian wholly owned subsidiaries when they join the income tax consolidated group? | A5: Yes. | Q6: Will the modified same business test under section 707-125 of the ITAA 1997 be satisfied in order for all the entity tax losses and net capital losses to be transferred by the entity to the income tax consolidated group under Subdivision 707-A of the ITAA 1997? | A6: Yes. | Q7: For the purposes of the available fraction calculation pursuant to Subdivision 707-C of the ITAA 1997, will the available fraction for all the entity tax losses and net capital loss be equal to 1 at the joining time? | A7: Yes. | Q8: Will the loan from the trust to the company constitute a 'debt interest' of the company under Division 974 of the ITAA 1997? | A8: Yes. | Q9: Does the Commissioner agree that the trust is not a 'connected entity' of the company at the time that the loan is entered into? | A9: Yes. | Q10: Will the loan from the trust to the company be a financial arrangement under section 230-45 of the ITAA 1997? | A10: Yes. | Q11: If the answer to Question 10 is yes, will the interest expense incurred by the company in respect of the loan be deductible on an accruals basis in accordance with the accruals method under section 230-100 of the ITAA 1997? | A11: Yes. | Q12: If the answer to Question 10 is yes, will subsection 230-20(4) of the ITAA 1997 apply to prevent the overall loss made by the company in relation to the loan from the trust from being allowed as an allowable deduction under other provisions outside of Division 230 of the ITAA 1997 for the same or any other income year? | A12: Yes. | Q13: Does the Commissioner agree that there is no reasonable basis to issue a determination to the company, pursuant to the provisions in Part IVA of the ITAA 1936, in connection with a scheme comprising of all or some of the steps in the restructure ? | A13: Yes.

Relevant facts and circumstances: The taxpayer has applied for a private ruling in relation to matters concerning a corporate restructure.

Relevant legislative provisions: Income Tax Assessment Act 1997 Section 108-5 | Section 110-25 | Section 112-30 | Section 124-365 | Section 124-380 | Section 165-12 | Section 165-15 | Section 230-20 | Section 230-45 | Section 230-100 | Section 230-105 | Section 230-115 | Section 701-1 | Section 701-10 | Section 701-30 | Section 701-60 | Section 703-5 | Section 703-15 | Section 703-20 | Section 703-25 | Section 703-30 | Section 703-33 | Section 703-70 | Section 703-75 | Section 703-80 | Section 705-35 | Section 705-175 | Section 707-120 | Section 707-140 | Section 707-210 | Section 707-320 | Section 960-130 | Section 960-135 | Section 974-5 | Section 974-20 | Section 974-35 | Section 974-75 | Section 974-80 | Section 974-130 | Section 974-135 | Section 974-160 | Subsection 995-1(1) | Income Tax Assessment Act 1936 Division 6 of Part III | Division 6C of Part III | Section 102P | Part IVA | Section 318