Commonwealth Consolidated Acts Commonwealth Consolidated Acts(1) Where a succession day is fixed for a receiving bank and the relevant transferring bank, this section applies to the business of that transferring bank that becomes, on that day, the transferred business of the receiving bank.
(2) It is the intention of the Parliament:
(a) that, on and after the succession day for a receiving bank and the relevant transferring bank, the receiving bank should, for all purposes of the Income Tax Assessment Act 1936 and the Income Tax Assessment Act 1997 , be placed in the same position in relation to the business to which this section applies as the transferring bank would have been apart from the operation or effect of this Act and of any complementary legislation and from anything done for a purpose connected with, or arising out of, that operation or effect; and
(b) that the operation or effect of this Act and of any complementary legislation and anything done for a purpose connected with, or arising out of, that operation or effect in relation to the business to which this section applies should, for all purposes of the Income Tax Assessment Act 1936 and the Income Tax Assessment Act 1997 , be revenue neutral, that is to say that no assessable income, deduction, capital gain or capital loss should be derived, or incurred, or should accrue, by or to the transferring bank or the receiving bank in relation to that business merely because of the operation or effect of this Act and of any complementary legislation or of anything done for a purpose connected with, or arising out of, that operation or effect.
(3) Where a succession day is fixed for a receiving bank and the relevant transferring bank, then, for the purposes of the Income Tax Assessment Act 1936 and the Income Tax Assessment Act 1997 , nothing in this Act affects the continuity of any partnership in which a transferring bank was a partner immediately before the succession day.
(4) Where a succession day is fixed for a receiving bank and the relevant transferring bank, then, for the purposes of the Income Tax Assessment Act 1936 and the Income Tax Assessment Act 1997 :
(a) all assessable income derived or taken to be derived by the transferring bank; and
(b) all allowable deductions and capital losses incurred or taken to be incurred by the transferring bank; and
(c) all other consequences (including the balances of tax losses that are carried forward) for the transferring bank;
are taken to have been derived or incurred by, or to have occurred in relation to, the receiving bank and not the transferring bank.
(5) Where a succession day is fixed for a receiving bank and the relevant transferring bank, then, for the purposes of Part 3 - 6 of the Income Tax Assessment Act 1997 (about the imputation system):
(a) if the transferring bank has a franking surplus at the end of the day before the succession day, then, at the beginning of the succession day:
(i) a franking debit equal to that franking surplus arises in the transferring bank; and
(ii) a franking credit equal to that franking surplus arises in the receiving bank; and
(b) if the transferring bank has a franking deficit at the end of the day before the succession day and the succession day is not the first day of the transferring bank's income year, then, at the beginning of the succession day:
(i) a franking credit equal to that franking deficit arises in the transferring bank; and
(ii) a franking debit equal to that franking deficit arises in the receiving bank.
(6) Subsections (3), (4) and (5) do not limit the generality of subsection (2).
(7) If, in any respect, the operation of subsection (2) requires further clarification, regulations may be made modifying or adapting the application of particular provisions of the Income Tax Assessment Act 1936 and the Income Tax Assessment Act 1997 for that purpose.
(8) For the purposes of subsection (2), where the dissolution of a transferring bank under complementary legislation involves any cancellation or other disposal of the shareholding in that bank, that cancellation or other disposal of a transferring bank is to be regarded as an effect of the complementary legislation.
(9) This section applies to BNZ and BNZ Savings only in so far as the business of BNZ Savings relating to its Australian operations vests in BNZ.
(10) In this section, complementary legislation includes parallel New Zealand legislation.