Document ID: chunk:federal_register_of_legislation:C2025C00029:section:3:p1
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 3 (pt 1/53)
Character Range: 2916891–2919569

3          Item 1 does not apply and the company came into being during the *loss year                                                                                          The end of the loss year

For the business continuity test: see Subdivision 165‑E.

165‑15  The same people must control the voting power, or the company must satisfy the business continuity test
 (1) Even if a company meets the conditions in section 165‑12 or 165‑13, it cannot deduct the *tax loss if:
 (a) for some or all of the part of the *ownership test period that started at the end of the *loss year, a person controlled, or was able to control, the voting power in the company (whether directly, or indirectly through one or more interposed entities); and
 (b) for some or all of the *loss year, that person did not control, and was not able to control, that voting power (directly, or indirectly in that way); and
 (c) that person began to control, or became able to control, that voting power (directly, or indirectly in that way) for the purpose of:
 (i) getting some benefit or advantage in relation to how this Act applies; or
 (ii) getting such a benefit or advantage for someone else;
  or for purposes including that purpose.
Note: A person can still control the voting power in a company that is in liquidation etc.: see section 165‑250.
 (2) However, that person's control of the voting power, or ability to control it, does not prevent the company from deducting the *tax loss if the company satisfies the *business continuity test for the income year (the business continuity test period).
 (3) Apply the *business continuity test to the *business that the company carried on immediately before the time (the test time) when the person began to control that voting power, or became able to control it.
For the business continuity test: see Subdivision 165‑E.

165‑20  When company can deduct part of a tax loss
 (1) If section 165‑10 (which is about deducting a tax loss) prevents a company from deducting a *tax loss, the company can deduct the part of the tax loss that was incurred during a part of the loss year.
 (2) However, the company can do this only if, assuming that part of the *loss year had been treated as the whole of the loss year for the purposes of section 165‑10, the company would have been entitled to deduct the *tax loss.

Subdivision 165‑B—Working out the taxable income and tax loss for the income year of the change

Guide to Subdivision 165‑B

165‑23  What this Subdivision is about

      A company that has not had the same ownership and control during the income year, and has not satisfied the business continuity test, works out its taxable income