Document ID: chunk:federal_register_of_legislation:C2025C00029:section:3:p17
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 3 (pt 17/30)
Character Range: 6187098–6189849

company's income or deduction
 (4) For the entity core purposes set out in section 701‑1 (Single entity rule) relating to the *general insurance company and the leaving year, the affected sections have effect as if each of the affected values for the general insurance company at the end of the previous income year were worked out under subsection (5).

Working out affected values at the end of the previous income year
 (5) Work out each of the affected values for the *general insurance company at the end of the previous income year as if it had ended at the leaving time.

713‑725  Treatment of certain assets and liabilities of general insurance companies
 (1) This section applies if a *general insurance company becomes or ceases to be a *subsidiary member of a *consolidated group.
 (2) If the *general insurance company becomes a *subsidiary member of the group:
 (a) in working out the step 2 amount for the purposes of the table in section 705‑60, reduce that amount by the sum of the amount of each thing mentioned in subsection (4); and
 (b) in working out the *tax cost setting amount of a thing mentioned in subsection (4) for the purposes of section 705‑35, treat the *market value of the thing as zero.
 (3) If the *general insurance company ceases to be a *subsidiary member of the group:
 (a) in working out the step 4 amount for the purposes of the table in section 711‑20, reduce that amount by the sum of the amount of each thing mentioned in subsection (4); and
 (b) for the purposes of section 711‑25, treat the *terminating value of a thing mentioned in subsection (4) as zero.
 (4) The things are the *general insurance company's:
 (a) *assets for insurance acquisition cash flows to the extent that they are used to measure the company's adjusted *liability for remaining coverage; and
 (b) deferred reinsurance expenses to the extent that they are used to measure the company's adjusted liability for remaining coverage; and
 (c) recoveries receivable, or potential recoveries, measured under the *applicable insurance contracts standard to the extent that they relate to insurance contracts or reinsurance contracts; and
 (d) claims handling costs that are neither attached to, nor directly attributable to, a particular claim, to the extent that these costs are used to measure the company's adjusted *liability for incurred claims; and
 (e) loss components and loss‑recovery components of onerous contracts to the extent that they are used to measure the company's adjusted liability for remaining coverage.

Division 715—Interactions between this Part and other areas of the income tax law

Table of Subdivisions
715‑A Treatment of unrealised losses existing when ownership or control of a company changes before or