Document ID: chunk:federal_register_of_legislation:C2004C01244:schedule:1:p1
Version: federal_register_of_legislation:C2004C01244
Segment Type: schedule
Provision Reference: sch 1 (pt 1/5)
Character Range: 96387–99249

Schedule 1—Tax losses and the Income Tax Assessment Act 1997

Subdivision 170-A—Transfer of tax losses from a transferring corporation to a receiving corporation

Guide to Subdivision 170-A

170-1  What this Subdivision is about

A transferring corporation (within the meaning of the Financial Corporations (Transfer of Assets and Liabilities) Act 1993) can transfer a tax loss to a receiving corporation (within the meaning of that Act) so that the receiving corporation can deduct it. The corporations must be related in such a way that that Act would apply to a transfer of assets from the transferring corporation to the receiving corporation.

Table of sections

170-5 Basic principles for transferring tax losses

        Effect of transferring a tax loss

170-10 When a company can transfer a tax loss
170-15 Income company is taken to have incurred transferred loss
170-20 Who can deduct transferred loss
170-23 When income company must maintain same owners and control
170-25 Tax treatment of payment for transferred tax loss

        Conditions for transfer

170-28 The Financial Corporations (Transfer of Assets and Liabilities) Act 1993 must apply to asset transfer from loss company to income company
170-32 The loss year
170-33 The transfer year
170-35 The loss company
170-50 Transfer by written agreement
170-55 Losses must be transferred in order they are incurred
170-60 Income company cannot transfer transferred tax loss

        Effect of agreement to transfer more than can be transferred

170-65 Agreement transfers as much as can be transferred
170-70 Amendment of assessments

170-5  Basic principles for transferring tax losses

 (1) A transferring corporation (within the meaning of the Financial Corporations (Transfer of Assets and Liabilities) Act 1993) can transfer a tax loss to a receiving corporation (within the meaning of that Act) so that the receiving corporation can deduct it.

 (2) The corporations must be related in such a way that that Act would apply to a transfer of assets from the transferring corporation to the receiving corporation.

 (3) The receiving corporation need not have enough assessable income to offset the transferred tax loss.

 (4) The tax loss is transferred by an agreement between the 2 corporations.

Effect of transferring a tax loss

170-10  When a corporation can transfer a tax loss

 (1) A transferring corporation within the meaning of the Financial Corporations (Transfer of Assets and Liabilities) Act 1993 (the loss company) can transfer an amount of its *tax loss for an income year of the loss company (the loss year) to a receiving corporation within the meaning of that Act (the income company) if the conditions in this Subdivision are met.

 (2) The amount transferred can be the whole or part of the *tax loss.

Note: A PDF cannot transfer a tax loss, except one for a