Document ID: chunk:federal_register_of_legislation:C2025C00029:section:4:p1
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 4 (pt 1/6)
Character Range: 6131164–6134232

4                                     Income Tax Assessment Act 1997 and Income Tax (Transitional Provisions) Act 1997  Part 3‑90 (of each Act)  The Part has effect as if an entity were a *wholly‑owned subsidiary of the trust if the entity would have been one had the trustee owned beneficially *membership interests in the entity that the trustee owned legally.

Subdivision 713‑E—Partnerships

Guide to Subdivision 713‑E

713‑200  What this Subdivision is about
      This Subdivision modifies tax cost setting rules in Divisions 701, 705 and 711 so that they take account of the special characteristics of partnerships. The modifications apply in these situations:

                (a) an entity that is a partner in a partnership becomes a subsidiary member of a consolidated group;
                (b) a partnership becomes, or ceases to be, a subsidiary member of a consolidated group.

Table of sections

Objects
713‑205 Objects of this Subdivision

Partnership cost setting interests etc.
713‑210 Partnership cost setting interests
713‑215 Terminating value for partnership cost setting interest

Setting tax cost of partnership cost setting interests
713‑220 Set tax cost of partnership cost setting interests if partner joins consolidated group
713‑225 Tax cost setting amount for partnership cost setting interest

Special rules where partnership joins consolidated group
713‑235 Partnership joins group—set tax cost of partnership assets
713‑240 Partnership joins group—tax cost setting amount for partnership asset

Special rules where partnership leaves consolidated group
713‑250 Partnership leaves group—standard provisions modified
713‑255 Partnership leaves group—tax cost setting amount for partnership cost setting interests
713‑260 Partnership leaves group—tax cost setting amount for assets consisting of being owed certain liabilities
713‑265 Partnership leaves group—adjustments to allocable cost amount of partner who also leaves group

Objects

713‑205  Objects of this Subdivision
 (1) The first object of this Subdivision is to ensure that if:
 (a) an entity that is a partner in a partnership becomes a *subsidiary member of a *consolidated group; and
 (b) the partnership does not become a *subsidiary member of the group;
the provisions mentioned in subsection (3) operate as if the *partnership cost setting interests of the entity in the partnership were the entity's only assets relating to the partnership.
Note: In general, the head company of the consolidated group is treated as a partner in the partnership, in accordance with section 701‑1 (the single entity rule).
 (2) The second object of this Subdivision is to ensure that where a partnership becomes a *subsidiary member of a *consolidated group, the provisions mentioned in subsection (3) operate:
 (a) as if the group became the holder of the assets of the partnership; and
 (b) to set the *tax cost of the assets of the partnership at an appropriate amount, taking into account the taxation treatment of partnerships.
Note: While the partnership is a subsidiary member