Document ID: chunk:federal_register_of_legislation:C2010C00584:clause:6_25:p2
Version: federal_register_of_legislation:C2010C00584
Segment Type: clause
Provision Reference: sch 6 cl 25 (pt 2/10)
Character Range: 75265–78091

PST assets of the life insurance company:
 (i) the membership interests (if any) that the life insurance company owns directly in the life insurance subsidiary;
 (ii) the membership interests (if any) that the life insurance company owns directly in the interposed entities; and
 (d) the *head company of the group makes a *tax loss or *net capital loss under Subdivision 707‑A because of a transfer from the life insurance subsidiary.

 (2) This Act operates for the purposes of income years ending after the transfer as if:
 (a) the *tax loss were of the *complying superannuation class; or
 (b) the *net capital loss were from *virtual PST assets.

 (3) Subdivisions 707‑B, 707‑C and 707‑D do not affect the *utilisation of the loss by the *head company of the *consolidated group.

713‑540  Losses of entities whose membership interests are segregated exempt assets of life insurance company

 (1) This section applies if:
 (a) a *life insurance company becomes a *member of a *consolidated group at a time (the joining time); and
 (b) at the joining time, the life insurance company owns, either directly or indirectly through one or more interposed entities, all the *membership interests in yet another entity (the life insurance subsidiary) that becomes a *subsidiary member of the group at that time; and
 (c) all the following membership interests are *segregated exempt assets of the life insurance company:
 (i) the membership interests (if any) that the life insurance company owns directly in the life insurance subsidiary;
 (ii) the membership interests (if any) that the life insurance company owns directly in the interposed entities.

 (2) A *tax loss or *net capital loss of the life insurance subsidiary for an income year ending before the joining time cannot be *utilised by the life insurance subsidiary for an income year ending after that time.

Note: This prevents the loss from being transferred to the head company of the consolidated group under Subdivision 707‑A (because it means the life insurance subsidiary could not have utilised the loss for the trial year). As a result, section 707‑150 prevents any other entity from utilising the loss for an income year ending after the joining time.

Imputation rules for life insurance companies joining consolidated group

713‑545  Treatment of franking surplus in franking account of life insurance subsidiary joining group

 (1) This section applies if:
 (a) a *life insurance company becomes a *member of a *consolidated group at a time (the joining time); and
 (b) at the joining time, the life insurance company owns, either directly or indirectly through one or more interposed entities, *membership interests in yet another entity (the life insurance subsidiary) that becomes a *subsidiary member of the group at that time; and
 (c) the life