INCOME TAX ASSESSMENT ACT 1997 - SECT 709.60 Nil balance franking account for joining entity

INCOME TAX ASSESSMENT ACT 1997 - SECT 709.60

  (1)   This section operates if an entity (the joining entity ) becomes a * subsidiary member of a * consolidated group at a time (the joining time ).

  (2)   If the joining entity's * franking account is in surplus just before the joining time:

  (a)   a debit equal to the * franking surplus arises at the joining time in the joining entity's franking account; and

  (b)   a credit equal to the franking surplus arises at the joining time in the franking account of the * head company of the group.

  (3)   If the joining entity's * franking account is in deficit just before the joining time:

  (a)   a credit equal to the * franking deficit arises at the joining time in the joining entity's franking account; and

  (b)   the joining entity is liable to pay * franking deficit tax as if the joining entity's income year had ended just before the joining time; and

  (c)   despite item   5 of the table in section   205 - 15, a credit does not arise under that item in the joining entity's franking account because of that liability.