INCOME TAX ASSESSMENT ACT 1997 - SECT 701.61 Assets in relation to Division 230 financial arrangement--head company's assessable income or deduction

INCOME TAX ASSESSMENT ACT 1997 - SECT 701.61

  (1)   This section applies if:

  (a)   an entity (the joining entity ) becomes a * subsidiary member of a * consolidated group; and

  (b)   paragraph   701 - 55(5A)(b) applies in relation to one or more assets of the joining entity.

  (2)   Work out if the total of the * Division   230 starting values for those assets exceeds or falls short of the total of their * tax cost setting amounts.

  (3)   If there is an excess, an amount equal to 25% of that excess is included in the * head company's assessable income for:

  (a)   the income year in which the particular time mentioned in subsection   701 - 55(5A) occurs; and

  (b)   each of the 3 subsequent income years.

  (4)   If there is a shortfall, the * head company is entitled to a deduction equal to 25% of that shortfall for:

  (a)   the income year in which the particular time mentioned in subsection   701 - 55(5A) occurs; and

  (b)   each of the 3 subsequent income years.