Document ID: chunk:federal_register_of_legislation:C2025C00029:section:3:p15
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 3 (pt 15/53)
Character Range: 2951068–2953745

Subdivision 165‑CC

165‑115  What this Subdivision is about

      If a change occurs in the ownership or control of a company that has an unrealised net loss, the company cannot, to the extent of the unrealised net loss, have capital losses taken into account, or deduct revenue losses, in respect of CGT events that happen to CGT assets that it owned at the time of the change, unless it satisfies the business continuity test.

165‑115AA  Special rules to save compliance costs
 (1) A company is exempt from these rules if, at the time of the change in ownership or control, it (together with certain related entities) has a net asset value of not more than $6,000,000 under the test in section 152‑15 (for small business CGT relief).
 (2) In working out whether it has an unrealised net loss, a company can choose to work out the market value of each of its assets individually, or of all of its assets together.
 (3) If a company works out the market value of each of its assets individually, it may choose to exclude every asset that it acquired for less than $10,000, in which case:
 (a) unrealised losses and gains on the excluded assets will not be taken into account in calculating the company's unrealised net loss; and
 (b) losses on the excluded assets will be allowed without the company being subject to the business continuity test.

Table of sections

Operative provisions
165‑115A Application of Subdivision
165‑115B What happens when the company makes a capital loss or becomes entitled to a deduction in respect of a CGT asset after a changeover time
165‑115BAWhat happens when a CGT event happens after a changeover time to a CGT asset of the company that is trading stock
165‑115BBOrder of application of assets: residual unrealised net loss
165‑115C Changeover time—change in ownership of company
165‑115D Changeover time—change in control of company
165‑115E What is an unrealised net loss
165‑115F Notional gains and losses

Operative provisions

165‑115A  Application of Subdivision

Application
 (1) This Subdivision applies to a company if:
 (a) a changeover time has occurred or occurs in relation to the company after the commencement time; and
 (b) at the changeover time the company had an unrealised net loss (see section 165‑115E); and
 (c) either of the following applies:
 (i) the company makes a *capital loss, or apart from this Subdivision would be entitled to a deduction, in respect of a *CGT event that happens to a *CGT asset referred to in subsection (1A);
 (ii) the company makes a *trading stock loss in respect of a CGT asset referred to in subsection (1A) that is an item of *trading stock; and
 (d) the company would not, at the