Document ID: chunk:federal_register_of_legislation:C2025C00029:section:3:p4
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 3 (pt 4/19)
Character Range: 5843950–5846828

section, the only tax payable by the original entity for the income year arises because of the application of section 701‑30 to non‑membership periods in the income year after the completion time.

Division 705—Tax cost setting amount for assets where entities become subsidiary members of consolidated groups

Guide to Division 705

705‑1  What this Division is about
      When an entity becomes a subsidiary member of a consolidated group, the tax cost of its assets is set at a tax cost setting amount that is worked out in accordance with this Division.

Table of Subdivisions
705‑A Basic case: a single entity joining an existing consolidated group
705‑B Case of group formation
705‑C Case where a consolidated group is acquired by another
705‑D Where multiple entities are linked by membership interests
705‑E Adjustments for errors etc.

Subdivision 705‑A—Basic case: a single entity joining an existing consolidated group

Guide to Subdivision 705‑A

705‑5  What this Subdivision is about
      When an entity becomes a subsidiary member of an existing consolidated group, the tax cost setting amount for its assets reflects the cost to the group of acquiring the entity.

Table of sections

Application and object
705‑10 Application and object of this Subdivision
705‑15 Cases where this Subdivision does not have effect

Tax cost setting amount for assets that joining entity brings into joined group
705‑20 Tax cost setting amount worked out under this Subdivision
705‑25 Tax cost setting amount for retained cost base assets
705‑27 Reduction in tax cost setting amount that exceeds market value of certain retained cost base assets
705‑30 What is the joining entity's terminating value for an asset?
705‑35 Tax cost setting amount for reset cost base assets
705‑40 Tax cost setting amount for reset cost base assets held on revenue account etc.
705‑45 Reduction in tax cost setting amount for accelerated depreciation assets
705‑47 Reduction in tax cost setting amount for some privatised assets
705‑55 Order of application of sections 705‑40, 705‑45 and 705‑47
705‑56 Modification for tax cost setting in relation to leases
705‑57 Adjustment to tax cost setting amount where loss of pre‑CGT status of membership interests in joining entity
705‑58 Assets and liabilities not set off against each other
705‑59 Exception: treatment of linked assets and liabilities

How to work out the allocable cost amount
705‑60 What is the joined group's allocable cost amount for the joining entity?
705‑62 No double counting of amounts in allocable cost amount
705‑65 Cost of membership interests in the joining entity—step 1 in working out allocable cost amount
705‑70 Liabilities of the joining entity—step 2 in working out allocable cost amount
705‑75 Liabilities of the joining entity—reductions for purposes of step 2 in working out allocable cost amount
705‑76 Liability