Document ID: chunk:federal_register_of_legislation:C2010C00690:clause:3_39:p2
Version: federal_register_of_legislation:C2010C00690
Segment Type: clause
Provision Reference: sch 3 cl 39 (pt 2/3)
Character Range: 285156–287736

before its apportioning day, this subitem does not reduce the amount of the net capital loss the company can transfer.

Apportioning limit based on transferee company's income or gains for final year

(6) Despite section 170‑45 of the Income Tax Assessment Act 1997, the amount of a tax loss (for the final year or an earlier income year) that can be transferred to the company for the final year cannot exceed the amount worked out using the formula:

Note: If the company's final year ends just before its apportioning day, this subitem does not reduce the amount of the tax loss that can be transferred to the company.

(7) Despite section 170‑145 of the Income Tax Assessment Act 1997, a net capital loss (for the final year or an earlier income year) can be transferred to the company for the final year:
 (a) only if the company would have had a net capital gain for the final year apart from that section had the final year ended on the day before the company's apportioning day; and
 (b) only to the extent to which it could have been transferred consistently with subsection 170‑145(6) of that Act if the result of step 1 of the method statement had been the amount of the company's net capital gain worked out on the basis described in paragraph (a) of this subitem.

Note: If the company's final year ends just before its apportioning day, this subitem does not reduce the amount of the net capital loss that can be transferred to the company.

Transfer not prevented by transferor joining consolidated group

(8) Subsections 170‑45(1) and 170‑145(1) of the Income Tax Assessment Act 1997 apply in relation to a transfer from a company (whether or not it is the company mentioned in subitem (4) or (5)) that becomes a member of a consolidated group or MEC group as if the fact that the company becomes such a member does not affect its ability to carry forward losses for the final year or an earlier income year.

Application to non‑membership periods less than a year

(9) If, under section 701‑30 of the Income Tax Assessment Act 1997, the company has a non‑membership period that ends just before the company first becomes a subsidiary member of a consolidated group or MEC group, Subdivisions 170‑A and 170‑B of that Act and subitems (3) to (8) (inclusive) apply in relation to the period as if it were the final year.

(10) To avoid doubt, section 701‑30 of the Income Tax Assessment Act 1997 does not prevent a company from transferring under Subdivision 170‑A or 170‑B of that Act (applying as described in subitem (9)) a non‑membership period loss described in