Commonwealth Consolidated Acts

INCOME TAX ASSESSMENT ACT 1997 - SECT 716.300

  (1)   This section has effect if:

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

  (b)   because of subsection   40 - 80(1), the joining entity could (or did) deduct for a period before the joining time the * cost of a * depreciating asset that became an asset of the * head company of the group at the joining time because section   701 - 1 (Single entity rule) applied to the joining entity; and

  (c)   the joining entity could not deduct an amount under Subdivision   40 - B (except because of subsection   40 - 80(1)) for the income year that includes the joining time for that cost.

Note:   Subdivision   40 - B allows deductions for the decline in value of depreciating assets. Subsection   40 - 80(1), which is in that Subdivision, provides that the decline in value of certain assets used for exploration and prospecting equals their cost.

  (2)   Subsection   701 - 55(2) has effect as if the * prime cost method for working out the decline in value of the * depreciating asset applied just before the joining time.

Note:   This may affect both the method of working out the decline in value of the asset and the asset's effective life.

Table of sections

Assets in joining entity's low - value pool

716 - 330   Head company's deductions for decline in value of assets in joining entity's low - value pool

Entity leaving group with asset allocated to head company's low - value pool

716 - 335   Entity leaving group with asset allocated to head company's low - value pool

Depreciating assets arising from expenditure in joining entity's software development pool

716 - 340   Depreciating assets arising from expenditure in joining entity's software development pool

Software development pools if entity leaves consolidated group

716 - 345   Head company taken not to have incurred expenditure