Document ID: chunk:federal_register_of_legislation:C2025C00029:section:3:p19
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 3 (pt 19/53)
Character Range: 2960704–2963369

residual unrealised net loss
 (2) If the *trading stock loss is equal to or less than the company's residual unrealised net loss at the time of the occurrence of the trading stock loss, the amount of the trading stock loss is to be included in the company's assessable income.

Where trading stock loss is greater than unrealised net loss
 (3) If the *trading stock loss is greater than the company's residual unrealised net loss at the time of the occurrence of the trading stock loss, the part of the trading stock loss that is equal to the residual unrealised net loss is to be included in the company's assessable income.

No increase in assessable income if company satisfies the business continuity test
 (4) Neither subsection (2) nor (3) applies to the company if the company meets the condition in section 165‑13 (the business continuity test).

Assumptions for purposes of business continuity test
 (5) In determining whether the company meets the condition in section 165‑13, assume:
 (a) that the *trading stock loss (if subsection (2) applies) or the part of the trading stock loss (if subsection (3) applies) is a *net capital loss of the company for the income year immediately before the income year in which the changeover time occurred; and
 (b) that the company failed, at the changeover time, to meet the condition in subsections 165‑12(2), (3) and (4) in relation to the net capital loss referred to in paragraph (a); and
 (c) that the changeover time is the test time; and
 (d) that the *business continuity test period is the income year in which the loss occurred.

165‑115BB  Order of application of assets: residual unrealised net loss

Order in which assets are to be applied
 (1) In applying subsection 165‑115B(2) or 165‑115BA(3) in respect of assets that the company owned at the changeover time:
 (a) the company's *capital losses are taken to have been made, the company is taken to have become entitled to deductions and the company is taken to have made *trading stock losses in the order in which the events that resulted in the capital losses, deductions or trading stock losses occurred; and
 (b) if 2 or more such events occurred at the same time, they are taken to have occurred in such order as the company determines.

Residual unrealised net loss
 (2) The company's residual unrealised net loss, at the time of an event (the relevant event) that resulted in the company making a *capital loss, becoming entitled to a deduction or making a *trading stock loss, in respect of an asset, is the amount worked out using the following formula:
where:
previous capital losses, deductions or trading stock losses means the total of