Document ID: chunk:federal_register_of_legislation:C2010C00605:clause:4_4:p1
Version: federal_register_of_legislation:C2010C00605
Segment Type: clause
Provision Reference: sch 4 cl 4 (pt 1/10)
Character Range: 61255–64175

4  At the end of Division 705
Add:

Subdivision 705‑C—Case where a consolidated group is acquired by another

Guide to Subdivision 705‑C

705‑170  What this Subdivision is about

      When a consolidated group is acquired by another consolidated group, modifications are made to the operation of Division 701 (the core rules) and Subdivision 705‑A (tax cost setting amount where a single entity joins a consolidated group) basically to ensure that the tax cost setting amount for assets of the acquired group that become those of the acquiring group reflects the cost to the latter group of acquiring the former.

Table of sections

Application and object

705‑175 Application and object of this Subdivision

Modified application of Division 701 in relation to acquired group etc.

705‑180 Modifications of Division 701

Modified application of Subdivision 705‑A in relation to acquiring group

705‑185 Subdivision 705‑A has effect with modifications

Modifications of Subdivision 705‑A for the purposes of this Subdivision

705‑190 Modified application of section 705‑50
705‑195 Modified application of subsection 705‑65(6)
705‑200 Modified application of section 705‑85
705‑205 Modified application of section 705‑125

[This is the end of the Guide.]

Application and object

705‑175  Application and object of this Subdivision

Application

 (1) This Subdivision applies if all of the *members of a *consolidated group (the acquired group) become members of another consolidated group (the acquiring group) at a particular time (the acquisition time) as a result of the *acquisition of *membership interests in the *head company of the acquired group.

Object

 (2) The object of this Subdivision is:
 (a) to modify the rules in Division 701 (the core rules) to complement the treatment of the acquired group as a single entity that applied before the acquisition time; and
 (b) to modify Subdivision 705‑A (which basically determines the tax cost setting amount for assets of an entity joining a consolidated group) to ensure that the *tax cost setting amount for assets of the acquired group that become those of the acquiring group reflects the cost to the latter group of acquiring the former.

Modified application of Division 701 in relation to acquired group etc.

705‑180  Modifications of Division 701

Certain provisions of Division 701 not to apply

 (1) If, because an entity ceases to be a *subsidiary member of the acquired group when this Subdivision applies, a provision of Division 701 (other than section 701‑25) would otherwise apply, in relation to the acquired group for the head company core purposes set out in subsection 701‑1(2) or for the entity core purposes set out in subsection 701‑1(3), the provision does not so apply.

Modified application of section 701‑5

 (2) Section 701‑5 (the entry history rule) applies in relation to the acquiring group for the head company core