Commonwealth Consolidated Acts Commonwealth Consolidated ActsObject
(1) The object of this section is to transfer to the assets of the joining entity any potential application of Subdivision 165‑CC (about unrealised capital and revenue losses) that existed in respect of the * head company’s * membership interests in the joining entity just before the joining time. This is done because the head company’s cost of becoming the holder of the joining entity’s assets is recognised under this Division as an amount reflecting the group’s cost of acquiring the joining entity.
Section applies if potential application of Subdivision 165‑CC to membership interests in joining entity
(2) This section applies if, assuming the * head company had, just before the joining time, made a * capital loss or a * trading stock loss in respect of a * CGT event that happened to a * CGT asset consisting of its * membership interests (the Subdivision 165‑CC membership interests ) in the joining entity, Subdivision 165‑CC would apply to the head company.
(3) If this section applies, then, in applying Subdivision 165‑CC for the head company core purposes, the following percentage of each of the * CGT assets, that become those of the head company because subsection 701‑1(1) (the single entity rule) applies, is taken to have been owned by the * head company at the changeover time mentioned in sections 165‑115C and 165‑115D:
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Entry history rule not to give rise to application of Subdivision 165‑CC
(4) For the * head company core purposes, section 701‑5 (the entry history rule) does not have the effect that Subdivision 165‑CC applies to a * capital loss or a * trading stock loss in respect of a * CGT event that happens to any * CGT asset that becomes that of the head company because subsection 701‑1(1) (the single entity rule) applies.