Document ID: chunk:federal_register_of_legislation:C2010C00690:clause:1_6:p5
Version: federal_register_of_legislation:C2010C00690
Segment Type: clause
Provision Reference: sch 1 cl 6 (pt 5/26)
Character Range: 186347–188964

after the leaving time, the head company's residual unrealised net loss under subsection 165‑115BB(2) is worked out as if the head company had made a capital loss, become entitled to a deduction or made a trading stock loss at the leaving time, in respect of the assets to which subsection (1) of this section applies, of an amount equal to the sum of the denied amounts for those assets.

711‑55  Tax cost setting amount for membership interests where multiple exit

 (1) If 2 or more entities cease to be *subsidiary members of the old group at the same time because of an event happening in relation to one of them, the *tax cost setting amount for each *membership interest mentioned in paragraphs 711‑10(a) and (b) is worked out in accordance with this section.

Object

 (2) The object of this section is to ensure that the *tax cost setting amount for *membership interests that each entity holds in another entity reflects a proportion of the other entity's cost for its net assets.

Tax cost setting amounts to be worked out for certain membership interests in all of the entities

 (3) A *tax cost setting amount must be worked out for each *membership interest (the subject interest) that one of the entities holds in another of the entities just before the leaving time, and this must be done:
 (a) by applying section 711‑15 to the subject interest as if:
 (i) a reference in that section, or any provision of this Division that relates to it, to any membership interest that *members of the old group hold in the leaving entity were a reference to the subject interest; and
 (ii) a reference in that section, or any provision of this Division that relates to it, to liabilities owed by members of the old group included a reference to liabilities owed by any of the entities that cease to be *subsidiary members of the old group at the leaving time; and
 (b) by working out the tax cost setting amount for membership interests in entities that are held by other entities before working out the tax cost setting amount for membership interests in those other entities.

Tax cost setting amount for membership interests acquired by head company

 (4) Then work out the *tax cost setting amount mentioned in paragraph 711‑10(a) for the *membership interests held by the *head company in the same way as under section 711‑15.

Note: In doing so, tax cost setting amounts worked out under subsection (3) of this section for membership interests held by the leaving entity in other entities will be taken into account in working out the allocable cost amount for the leaving entity. Those tax cost setting