Document ID: chunk:federal_register_of_legislation:C2025C00029:section:4:p87
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 4 (pt 87/95)
Character Range: 5770861–5773394

treating each period separately with no netting off between them.

When section has effect
 (2) This section has effect for the entity core purposes if:
 (a) the entity is a *subsidiary member of the group for some but not all of an income year; and
 (b) there are one or more periods in the income year (each of which is a non‑membership period) during which the entity is not a subsidiary member of any *consolidated group.

Tax position of each non‑membership period to be worked out
 (3) For every non‑membership period, work out the entity's taxable income (if any) for the period, the income tax (if any) payable on that taxable income and the entity's loss (if any) (a non‑membership period loss) of each *sort for the period. Work them out:
 (a) as if the start and end of the period were the start and end of the income year; and
 (b) ignoring the operation of this section in relation to each other non‑membership period (if any); and
 (c) so that each relevant item is either:
 (i) allocated to only one of the non‑membership periods or to a period that is all or part of the rest of the income year; or
 (ii) apportioned among such periods (for example, by Subdivision 716‑A (see note to this subsection)).
Note: Other provisions of this Part are to be applied in working out the taxable income or loss, for example:
• section 701‑40 (Exit history rule); and
• Subdivision 716‑A (about assessable income and deductions spread over several membership or non‑membership periods); and
• section 716‑850 (about grossing up threshold amounts for periods of less than 365 days).
 Subdivision 716 also affects the tax position of the head company of a group of which the entity has been a subsidiary member for some but not all of the income year.
 (3A) For the purposes of working out the entity's taxable income (if any) for the non‑membership period, determine:
 (a) whether the entity can *utilise a loss of any *sort transferred to the entity in the period; and
 (b) if the period started at the start of the income year—whether the entity can utilise a loss of any sort:
 (i) made by the entity, without a transfer, for an earlier income year; or
 (ii) transferred to the entity in an earlier income year;
as if the time just after the end of the period were the end of the income year and the entity carried on at that time the same business that it carried on just before that time. Paragraph (3)(a) has effect subject to this subsection.
Note: This means that things that happen in relation to the entity at the time it