Document ID: chunk:federal_register_of_legislation:C2024C00267:section:3:p15
Version: federal_register_of_legislation:C2024C00267
Segment Type: section
Provision Reference: s 3 (pt 15/17)
Character Range: 600324–603006

under section 40‑340 of that Act in a case covered by item 4 of the table in subsection (1) of that section; and
 (b) the cost base or reduced cost base of the roll‑over asset or any other asset that:
 (i) became an asset of the head company when the transitional group came into existence because subsection 701‑1(1) (the single entity rule) of that Act applies; or
 (ii) was otherwise an asset of the head company at that time;
  differs at that time from what it would have been if the act, transaction or event that gave rise to the CGT event had not occurred in relation to the roll‑over asset;
then the provisions mentioned in subsection (2) apply as if the act, transaction or event had not occurred in relation to the roll‑over asset.
 (2) The provisions are:
 (a) Division 705 of the Income Tax Assessment Act 1997; and
 (b) provisions of this Act modifying the effect of that Division.
 (2A) Subsection (1) does not apply if:
 (a) the act, transaction or event mentioned in subsection (1) happened before a demerger and in connection with the demerger; and
 (b) before the transitional group came into existence, at least one of the following entities ceased to be a member of the demerger group because of the demerger:
 (i) the originating company in relation to the roll‑over, or the transferor in relation to the roll‑over relief;
 (ii) the recipient company, or the transferee in relation to the roll‑over relief; and
 (c) when the transitional group came into existence, at least one of those entities was not a member of that group.
 (3) Subsection (1) does not apply if:
 (a) the roll‑over asset is a membership interest in an entity (the test entity); and
 (b) when the CGT event happened:
 (i) the originating company in relation to the roll‑over, or the transferor in relation to the roll‑over relief, was a foreign resident; and
 (ii) the recipient company, or the transferee in relation to the roll‑over relief, was an Australian resident; and
 (c) when the transitional group came into existence, the test entity was a subsidiary member of the group, other than as a transitional foreign‑held subsidiary of the group.

701‑40  When entity leaves transitional group, head company may choose, for purposes of transitional group's allocable cost amount, to increase terminating values of over‑depreciated assets
 (1) This section applies if an entity ceases to be a subsidiary member of the transitional group and the requirements of subsections (2) to (4) are satisfied.

Asset held at leaving time
 (2) Just before the entity ceases to be a subsidiary member, it must, disregarding subsection 701‑1(1) (the single entity rule) of the Income Tax Assessment Act