Document ID: chunk:federal_register_of_legislation:C2025C00029:section:4:p2
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 4 (pt 2/5)
Character Range: 6063233–6065911

joining entity's basic income tax liability for that income year.

Transfer of excess to head company
 (2) For the purpose of applying subsection 205‑70(1) to the *head company of the *consolidated group for the income year in which the joining time occurs:
 (a) if, as described in paragraph 205‑70(1)(c), an amount of a *tax offset remains after applying section 63‑10—that amount is taken to be increased by the amount of the joining entity's excess; or
 (b) otherwise:
 (i) paragraph 205‑70(1)(c) is taken to apply to the head company; and
 (ii) the remaining amount of a tax offset covered by that paragraph is taken to be the amount of the joining entity's excess.
Note: Paragraph 205‑70(1)(c) refers to tax offsets under section 205‑70.
 (2A) In working out whether paragraph (2)(a) applies, take into account any application of this section to any other entity that became a *subsidiary member of the group before the joining time.

Joining entity prevented from utilising excess in later income years
 (3) For the purpose of applying subsection 205‑70(1) to the joining entity for any income year after that in which the joining time occurs, the joining entity's excess is disregarded.

709‑190  Exit history rule not to treat leaving entity as having a franking deficit tax offset excess
  To avoid doubt, if:
 (a) the *head company of a *consolidated group is entitled to a *tax offset under section 205‑70 for an income year; and
 (b) an amount (the excess) of the offset remains after applying section 63‑10 (about the tax offset priority rules) to the head company's basic income tax liability for that income year; and
 (c) an entity ceases to be a *subsidiary member of the group in the income year;
the entity is not taken because of section 701‑40 (the exit history rule):
 (d) to have the excess; or
 (e) to have another excess of that kind because of the circumstances that caused the head company to have the excess.

Subdivision 709‑D—Deducting bad debts

Guide to Subdivision 709‑D

709‑200  What this Subdivision is about
      An entity can deduct a bad debt that:

                (a) has for a period been owed to a member of a consolidated group; and
                (b) has for another period been owed to an entity that was not a member of that group;
      only if each entity that has been owed the debt for such a period could have deducted the debt had it been written off as bad at the end of the period. This applies even if the debt is owed to the same entity for different periods.

Table of sections

Application and object
709‑205 Application of this Subdivision
709‑210 Object of this Subdivision

Limit on deduction of bad debt
709‑215