Document ID: chunk:federal_register_of_legislation:C2025C00029:section:3:p32
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 3 (pt 32/45)
Character Range: 5988795–5991345

the extent permitted by:
 (a) the general rules (outside this Part) about an entity utilising a loss it has made; and
 (b) the special rules about transferred losses in the other Subdivisions of this Division that supplement and modify those general rules.
Note: If the entity from which the loss was transferred became a subsidiary member of the consolidated group, the entity cannot utilise the loss for those income years because of section 701‑1 (single entity rule) and section 707‑140.
 (2) If the loss is not transferred, then, for an income year ending after the time the entity became a member of the consolidated group, the loss cannot be utilised by any entity.
Note: The loss will not be transferred if the entity would not have been able to utilise it or if the transfer is cancelled under section 707‑145.

Objects

707‑110  Objects of this Subdivision
  The main objects of this Subdivision are:
 (a) to provide for the transfer of a loss from an entity (the joining entity) becoming a *member of a *consolidated group to the *head company of the group (so the head company may be able to *utilise it), if the joining entity could have utilised the loss if it had not become a member of the group; and
 (b) to prevent the utilisation by any entity of a loss made by the joining entity, if the joining entity could not have utilised the loss if it had not become a member of the group.

Application

707‑115  What losses this Subdivision applies to
  This Subdivision applies to a loss of any *sort if:
 (a) an entity (the joining entity) becomes a *member of a *consolidated group (the joined group) at a time (the joining time) in an income year (the joining year); and
 (b) the loss was made by the joining entity for an income year ending before the joining time.
Note 1: If the joining entity had a loss transferred to it by a previous operation of this Subdivision (when the entity was the head company of a consolidated group), this Subdivision operates later as if the joining entity had made the loss. See section 707‑140.
Note 2: Section 707‑405 may affect the income year for which the joining entity is treated as having made the loss, if the joining entity made the loss and the loss is referable to part of an income year.

Transfer of loss from joining entity to head company

707‑120  Transfer of loss from joining entity to head company

Transfer of loss from joining entity to head company
 (1) Subject to subsection (1A), the loss is transferred at the joining time from the joining entity to the *head company of the