Document ID: chunk:federal_register_of_legislation:C2010C00690:clause:3_39:p1
Version: federal_register_of_legislation:C2010C00690
Segment Type: clause
Provision Reference: sch 3 cl 39 (pt 1/3)
Character Range: 282860–285401

39  Transfer for final income year before amendments apply

(1) In this item:
apportioning day of a company means:
 (a) if item 37 applies to the company—1 July 2003; or
 (b) if item 38 applies to the company—the consolidation day.

Application

(2) This item applies to these transfers under Subdivision 170‑A or 170‑B of the Income Tax Assessment Act 1997 involving a company:
 (a) a transfer by the company of a loss it made for the income year (the final year) just before the first income year for which the amendments of those Subdivisions by this Schedule apply to the company;
 (b) a transfer to the company for the final year of a loss made for that income year or an earlier income year.
However, this item does not apply to a transfer involving companies that would satisfy either subsections 170‑30(3) and (4) or 170‑130(3) and (4) of that Act (as amended by this Schedule) if those subsections applied for the final year.

Object

(3) The main object of this item is to ensure that the company can either:
 (a) transfer a loss it makes for the final year only so far as the loss is attributable to so much of the final year as occurs before its apportioning day; or
 (b) utilise a loss transferred to it to reduce income or gains for the final year only so far as the income or gains are attributable to so much of the final year as occurs before its apportioning day.

Apportioning limit on transferring company's loss for final year

(4) Despite section 170‑45 of the Income Tax Assessment Act 1997, the amount of a tax loss made for the final year by the company that can be transferred cannot exceed the amount worked out using the formula:

Note: If the company's final year ends just before its apportioning day, this subitem does not reduce the amount of the tax loss the company can transfer.

(5) Despite section 170‑145 of the Income Tax Assessment Act 1997, a net capital loss made for the final year by the company:
 (a) can be transferred only if the sum of the capital losses made by the company during the final year before its apportioning day exceeds the sum of the capital gains made by the company during the final year before its apportioning day; and
 (b) cannot be transferred to an extent greater than that excess.

Note: If the company's final year ends just before its apportioning day, this subitem does not reduce the amount of the net capital loss the company can transfer.

Apportioning limit based on transferee company's income or gains for final year

(6) Despite section 170‑45 of the Income Tax