Document ID: chunk:federal_register_of_legislation:C2014C00749:clause:6_2:p1
Version: federal_register_of_legislation:C2014C00749
Segment Type: clause
Provision Reference: sch 6 cl 2 (pt 1/5)
Character Range: 36794–39514

2  After Division 711
Insert:

Division 717—International tax rules

Table of Subdivisions
717‑A Foreign tax credits
717‑D Attributable income: entry rules
717‑E Attributable income: exit rules

Subdivision 717‑A—Foreign tax credits

Guide to Subdivision 717‑A

717‑1  What this Subdivision is about
      If an entity becomes a subsidiary member of a consolidated group, its excess foreign tax credits are transferred to the head company of the group, for use in later income years. The head company receives any foreign tax credits that arise because the entity pays foreign tax while it is a subsidiary member of the group.

Table of sections

Objects
717‑5 Objects of this Subdivision

Foreign tax on amounts in head company's assessable income
717‑10 Head company taken to be liable for subsidiary member's foreign tax

Foreign tax on amounts not in head company's assessable income
717‑15 Transferring subsidiary member's excess foreign tax credits from earlier years to head company
717‑20 Where entity not subsidiary member for whole of income year
[This is the end of the Guide.]

Objects

717‑5  Objects of this Subdivision
 (1) The main objects of this Subdivision are set out in subsections (2), (3) and (4).
 (2) The first of those objects is to allow the *head company of a *consolidated group to get the benefit of foreign tax paid in respect of foreign income (within the meaning of the Income Tax Assessment Act 1936) included in the head company's assessable income because another entity is or was a *subsidiary member of the group.
 (3) The second of those objects is to allow the *head company of a *consolidated group to apply, in relation to an income year, *excess foreign tax credits of an entity (the joining entity) that becomes a *subsidiary member of the group at a time (the joining time) if:
 (a) the income year starts after the joining time; and
 (b) those excess foreign tax credits are from an income year ending before the joining time.
 (4) The third of those objects is to prevent an entity (other than the *head company of the group) from applying *excess foreign tax credits mentioned in paragraph (3)(b) to increase its own credits in respect of foreign tax.

Foreign tax on amounts in head company's assessable income

717‑10  Head company taken to be liable for subsidiary member's foreign tax
 (1) This section operates if:
 (a) an entity was a *subsidiary member of a *consolidated group for all or part of an income year; and
 (b) the assessable income of the *head company of the group for that income year included foreign income (within the meaning of the Income Tax Assessment Act 1936); and
 (c) the entity paid, and was personally liable for, foreign tax (within the