INCOME TAX ASSESSMENT ACT 1997 - SECT 195.35 Net capital loss for year in which company becomes a PDF

INCOME TAX ASSESSMENT ACT 1997 - SECT 195.35

  (1)   This section applies if a company becomes a * PDF during an income year and is still a PDF at the end of it.

  (2)   Divide the income year into periods according to subsection   195 - 15(2) (about working out the company's tax loss for the income year).

  (3)   For each period, work out whether the company has a * net capital gain or a * net capital loss (or both), treating each period as if it were an income year.

  (4)   If the company has:

  (a)   a * net capital gain for the non - PDF period; and

  (b)   a * net capital loss for the PDF period;

that loss is a net capital loss of the company for the income year.

Note:   The company can only apply the loss while it is a PDF: see section   195 - 25.

  (5)   If the company has a * net capital loss for the non - PDF period:

  (a)   section   195 - 25 does not prevent the company from applying its * net capital loss for the income year in working out its * net capital gain for a later income year; and

  (b)   section   195 - 30 does not prevent the company from transferring an amount of its net capital loss for the income year under Subdivision   170 - B (which is about the transfer of net capital losses within certain wholly - owned groups of companies);

to the extent that its net capital loss for the income year does not exceed its net capital loss for the non - PDF period.

  (6)   These rules apply in addition to the other rules about how * net capital losses are applied or transferred.

The other rules start in Division   102 (about net capital gains and losses).