Document ID: chunk:federal_register_of_legislation:C2004C00958:clause:1_4:p6
Version: federal_register_of_legislation:C2004C00958
Segment Type: clause
Provision Reference: sch 1 cl 4 (pt 6/8)
Character Range: 577937–580618

such further time as the Commissioner allows.

Note: The agreement will usually be made in the next income year after the one for which the gain company will apply the loss.

170‑155  Losses must be transferred in order they are made

  If the loss company has 2 or more *net capital losses that it can transfer in the application year, it can transfer them only in the order in which it made them.

170‑160  Gain company cannot transfer transferred net capital loss

  The gain company cannot transfer an amount of a *net capital loss transferred to it, or any part of the amount.

Effect of agreement to transfer more than can be transferred

170‑165  Agreement transfers as much as can be transferred

 (1) If the amount specified in an agreement exceeds the maximum amount that the loss company can transfer to the gain company in the application year, only that maximum amount is taken to have been transferred.

 (2) One reason why an agreement might specify more than can be transferred is that an assessment has been amended since the agreement.

170‑170  Amendment of assessments

  The Commissioner may amend an assessment to *disallow a transferred amount of a *net capital loss:

 (a) if the agreement to transfer the net capital loss is ineffective because the loss company did not actually make the loss; or

 (b) to the extent that section 170‑165 reduces the transferred amount because the loss company did not actually make some of it.

  The Commissioner may do so despite section 170 (Amendment of assessments) of the Income Tax Assessment Act 1936.

Effect of transfer on cost base of equity or debt interest held by company in the same wholly‑owned group

170‑175  Direct and indirect interests in the loss company

 (1) If:

 (a) an amount of a *net capital loss is transferred; and

 (b) a company (the group company) holds a *share in the loss company or is owed a debt by it in respect of a loan; and

 (c) the group company *acquired the share or debt on or after 20 September 1985; and

 (d) throughout the application year, the group company is a member of the same *wholly‑owned group as the loss company (disregarding a period when either was not *in existence);

the *cost base and *reduced cost base of the share or debt are reduced by an amount that is appropriate having regard to:

 (e) any consideration received by the loss company for the transferred amount; and

 (f) the group company's direct or indirect interest in the loss company.

Note: Reductions under subsection 160ZP(13) of the Income Tax Assessment Act 1936 are also relevant: see section 170‑175 of the Income Tax (Transitional Provisions) Act 1997.