Document ID: chunk:federal_register_of_legislation:C2025C00029:section:2:p52
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 2 (pt 52/66)
Character Range: 6457785–6460563

707‑A after the application event.
This subsection has effect despite subsection (3).
 (5) Disregard the existence of the *bundle at and after the time of the application event for the purposes of working out the *available fraction for another *bundle of losses.
 (6) The losses cannot be *utilised by any entity for an income year starting after the application event.
 (7) The choice cannot be revoked.

Subdivision 719‑H—Imputation issues

719‑425  Guide to Subdivision 719‑H
      This Subdivision deals with some imputation issues in relation to MEC groups.

Table of sections

Operative provisions
719‑430 Transfer of franking account balance on cessation event
719‑435 Distributions by subsidiary members of MEC group taken to be distributions by head company

Operative provisions

719‑430  Transfer of franking account balance on cessation event
 (1) This section operates if:
 (a) a *cessation event happens to the *provisional head company of a *MEC group (the former head company); and
 (b) another company (the new head company) is appointed as the provisional head company of the group under subsection 719‑60(3).
 (2) When the new head company is appointed:
 (a) the *franking account of the former head company ceases to operate; and
 (b) the new head company has a franking account; and
 (c) any *franking surplus or *franking deficit in the franking account of the former head company just before the *cessation event happened becomes that of the new head company.

719‑435  Distributions by subsidiary members of MEC group taken to be distributions by head company
 (1) Part 3‑6 operates as if a *frankable distribution made by an *eligible tier‑1 company that:
 (a) is a member of a *MEC group; and
 (b) is not the *provisional head company of the group;
had been made by the provisional head company of the group to a *member of the provisional head company.
Note: Part 3‑6 deals with imputation.
 (2) Part 3‑6 operates as if a *frankable distribution made by a *subsidiary member of a *MEC group (the foreign‑held subsidiary) that is not an *eligible tier‑1 company were a frankable distribution made by the *head company of the group to a *member of the head company if:
 (a) the foreign‑held subsidiary meets the set of requirements in section 703‑45, section 701C‑10 of the Income Tax (Transitional Provisions) Act 1997 or section 701C‑15 of that Act; and
 (b) the frankable distribution is made to a foreign resident.

Subdivision 719‑I—Bad debts

Guide to Subdivision 719‑I

719‑450  What this Subdivision is about
      The head company of a MEC group is taken to meet the conditions in section 165‑123 (about maintaining the same ownership in an ownership test period to be able to deduct a bad debt) if and only if the top company for the group at