Document ID: chunk:federal_register_of_legislation:C2025C00029:section:3:p10
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 3 (pt 10/11)
Character Range: 3210094–3212701

company (the gain company) if the conditions in this Subdivision are met.
 (2) The amount transferred can be the whole or part of the *net capital loss.
Note: A PDF cannot transfer a net capital loss, except one for a period before it became a PDF: see section 195‑30 of the Income Tax Assessment Act 1997.

170‑115  Who can apply transferred loss
 (1) If an amount of a *net capital loss is transferred, the gain company can apply the amount in working out its *net capital gain, but only for the income year of the gain company for which the amount is transferred. That income year is called the application year.
Note: A company's net capital gain or net capital loss for an income year is usually worked out under section 102‑5 or 102‑10.
 (2) The loss company can no longer *utilise the transferred amount and is taken not to have made the *net capital loss to the extent of that amount.
 (3) Despite subsection (1), if the *net capital loss is transferred because the conditions in section 170‑132 are met, the gain company is taken to have made the net capital loss for the income year for which the first prior transferor mentioned in that section made the net capital loss.
 (4) Despite subsection (1), if the *net capital loss is transferred because the condition in subsection 170‑142(4) is met, the gain company is taken to have made the net capital loss for the income year for which that subsection assumes the gain company made the net capital loss.

170‑120  Gain company is taken to have made transferred loss
 (1) If an amount of a *net capital loss is transferred, the amount is taken to be a *net capital loss of the gain company for the capital loss year.
 (2) However, if the capital loss year is the same as the application year, the amount is taken to be a *capital loss of the gain company for the application year.

170‑125  Tax treatment of consideration for transferred tax loss
 (1) If the loss company receives consideration from the gain company for the transferred amount:
 (a) the consideration is neither assessable income nor *exempt income of the loss company; and
 (b) the loss company does not make a *capital gain because of receiving the consideration.
Note: However, the consideration may affect how section 170‑220 modifies the cost base of direct and indirect interests in the loss company.
 (2) If the gain company gives consideration to the loss company for the transferred amount:
 (a) the gain company cannot deduct the consideration; and
 (b) the gain company does not make a *capital loss because of giving the consideration.
Note: However, the consideration