Document ID: chunk:federal_register_of_legislation:C2010C00604:clause:6_1:p3
Version: federal_register_of_legislation:C2010C00604
Segment Type: clause
Provision Reference: sch 6 cl 1 (pt 3/4)
Character Range: 85323–87930

320‑245 at the joining time.

 (4) Subsection (5) applies to a liability of the joining entity if:
 (a) the liability is under the *net risk component of a *life insurance policy; and
 (b) the joining entity could deduct under section 320‑80 an amount for the *risk component of claims paid under the policy had it not become a *member of the *consolidated group.

 (5) The value of that liability is the *current termination value of the *net risk component of the *life insurance policy at the joining time (calculated by an *actuary).

 (6) The value of the joining entity's liabilities under the *net investment component of ordinary life insurance policies is the amount worked out for those liabilities under subsection 320‑190(2) as if those liabilities were *virtual PST liabilities.

713‑525  Obligation to value virtual PST assets and segregated exempt assets

  Division 320 has effect as if:
 (a) the joining time when a *life insurance company becomes a *subsidiary member of a *consolidated group; and
 (b) the time (the leaving time) when a life insurance company ceases to be a subsidiary member of a consolidated group;
were a valuation time for the purposes of sections 320‑175 and 320‑230.

Note: This means that:
                  *   the company must value its virtual PST assets under section 320‑175 (with the consequences set out in section 320‑180), and its segregated exempt assets under section 320‑230 (with the consequences set out in section 320‑235), as at the joining time; and
                  *   the head company must value the life insurance company's virtual PST assets and its segregated exempt assets as at the leaving time.

713‑530  Certain amounts transferred to leaving entity

 (1) This section operates if:
 (a) a *life insurance company ceases to be a subsidiary member of a *consolidated group in an income year; and
 (b) at the leaving time, no other member of the group is a life insurance company that has a *virtual PST; and
 (c) either:
 (i) at the leaving time, the *head company of the group has a *net capital loss from *virtual PST assets; or
 (ii) the head company has an amount referred to in subsection 320‑205(2) as a difference that it could not apply to reduce any *virtual PST component of the *complying superannuation class of the company's taxable income for the income year in which the leaving time occurred.

 (2) The *net capital loss, or the difference, becomes that of the *life insurance company just after the leaving time.

[The next Division is Division 715.]

Part 2—Consequential amendments

Income Tax Assessment Act 1997