Document ID: chunk:federal_register_of_legislation:C2025C00029:section:4:p86
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 4 (pt 86/95)
Character Range: 5768629–5771087

the asset.
Note: In the case of assets other than trading stock or registered emissions units, the fact that the head company ceases to hold them when the single entity rules ceases to apply to them would not constitute a disposal or other event having tax consequences for the head company.

Setting value of trading stock at tax‑neutral amount
 (4) If subparagraph (2)(a)(i) applies, the asset is taken to be *trading stock of the *head company at the end of the income year (but not at the start of the next income year) and its *value at that time is taken to be equal to:
 (a) if the asset was trading stock of the head company at the start of the income year (including as a result of its *tax cost being set)—the asset's value at that time; or
 (b) if paragraph (a) does not apply and the asset is *live stock that was acquired by natural increase—the *cost of the asset; or
 (c) in any other case—the amount of the outgoing incurred by the head company in connection with the acquisition of the asset;
increased by the amount of any outgoing forming part of the cost of the asset that was incurred by the head company during its current holding of the asset.
Note: As a consequence of fixing the trading stock's value at the end of the income year under this subsection, no election would be available under section 70‑45 to value the trading stock at that time.

Setting value of registered emissions unit at tax‑neutral amount
 (5) If subparagraph (2)(a)(ii) applies, the asset is taken to be an asset of the *head company at the end of the income year (but not at the start of the next income year) and the head company's *value for the asset at that time is taken to be equal to:
 (a) if the asset was *held by the head company at the start of the income year—the value of the asset at the start of the income year; or
 (b) otherwise—the expenditure incurred by the head company in becoming the holder of the asset.

Entity rules

701‑30  Where entity not subsidiary member for whole of income year

Object
 (1) The object of this section is to provide for a method of working out how the entity core rules apply to the entity for periods in the income year when the entity is not part of the group. The method involves 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