the accounting liability is covered by subsection (1AC); and

assuming that the *head company had made a payment to discharge the accounting liability to the extent that it is covered under that subsection just after the joining time, that payment would result in an amount equal to all or part of the accounting liability being a deduction to the head company of the group.

any of the following provisions apply in relation to the liability:

section 713-520 (certain liabilities etc. of life insurance company that joins a consolidated group);

section 715-375 (accounting liabilities that are, or are part of, a Division 230 financial arrangement held by an entity that joins a consolidated group); or

section 713-515 (certain assets taken to be retained cost base assets where life insurance company joins a consolidated group) applies in relation to an asset to which the liability relates; or

the liability is any of the following:

(i) the outstanding claims liability of a *general insurance company, or a private health insurer (within the meaning of the Private Health Insurance (Prudential Supervision) Act 2015), under *general insurance policies;

the unearned premium liability of a general insurance company, or a private health insurer (within the meaning of that Act), under general insurance policies;

the unexpired risk liability of a general insurance company, or a private health insurer (within the meaning of that Act), under general insurance policies; or

the liability arises under any of the following:

a *retirement village residence contract;

a *retirement village services contract.

paragraph 705-70(1AC)(c); or

paragraph 705-70(1AC)(d).

paragraph 705-70(1AC)(c); or

paragraph 705-70(1AC)(d).

at the joining time, a *member of the joined group is an *ADI or a *financial entity;

in working out the step 2 amount mentioned in subsection 705-70(1) in relation to the joining entity, an amount would be added under that subsection for the securitisation liability (disregarding subsection 705-70(4));

(c) the joining entity transferred or equitably assigned one or more assets (the underlying securitised assets) to another entity before the joining time;

the securitisation liability:

arose from the transfer or equitable assignment of the underlying securitised assets; and

is a liability of the joining entity at the joining time (according to the joining entity’s *accounting principles for tax cost setting);

the other entity was established for the purpose of securitising assets;

the underlying securitised assets were securitised in accordance with that purpose before the joining time;

at the joining time the *market value of the joining entity’s interest in the underlying securitised assets is nil, or is substantially less than the amount of the securitisation liability.

just before the leaving time, a *member of the old group is an *ADI or a *financial entity;

in working out the step 4 amount mentioned in subsection 711-45(1) in relation to the leaving entity, an amount would be added under that subsection for the securitisation liability (disregarding subsection 711-45(11));

(c) a member of the old group transferred or equitably assigned one or more assets (the underlying securitised assets) to another entity before the leaving time;

the securitisation liability:

arose from the transfer or equitable assignment of the underlying securitised assets; and

is a liability of the leaving entity at the leaving time (according to the leaving entity’s *accounting principles for tax cost setting);

the other entity was established for the purpose of securitising assets;

the underlying securitised assets were securitised in accordance with that purpose before the leaving time;

at the leaving time the *market value of the leaving entity’s interest in the underlying securitised assets is nil, or is substantially less than the amount of the securitisation liability.

(a) the circumstances mentioned in Income Tax Assessment Act 1997 (as inserted by this Schedule) existed in respect of the joining entity; andsection 705-76 of the

before the 2014 budget time, the head company of the group:

(i) worked out the group’s allocable cost amount for the joining entity; and

for the purposes of working out that allocable cost amount, worked out the step 2 amount mentioned in subsection 705-70(1) of that Act; and

in working out that step 2 amount before the 2014 budget time, the head company added the amount mentioned in paragraph 705-76(b) of that Act (as inserted by this Schedule).

subitem (2) does not apply because of subitem (3); and

(b) the Commissioner considers that it is reasonable to conclude that, before the 2014 budget time, the head company of the group worked out a tax cost setting amount for the joining entity’s interest in the underlying securitised assets mentioned in paragraph 705-76(c) of the Income Tax Assessment Act 1997 (as inserted by this Schedule).

(a) the circumstances mentioned in Income Tax Assessment Act 1997 (as inserted by this Schedule) existed in respect of the joining entity; andsection 705-76 of the

the head company of the group first worked out the group’s allocable cost amount for the joining entity:

after the 2014 budget time; and

before the commencement of this item.

(a) the circumstances mentioned in Income Tax Assessment Act 1997 (as inserted by this Schedule) existed in respect of the leaving entity; andsection 711-46 of the

(b) before the 2014 budget time, the head company of the group (the old group):

(i) worked out the old group’s allocable cost amount for the leaving entity; and

for the purposes of working out that allocable cost amount, worked out the step 4 amount mentioned in subsection 711-45(1) of that Act; and

in working out that step 4 amount before the 2014 budget time, the head company added the amount mentioned in paragraph 711-46(b) of that Act (as inserted by this Schedule).

subitem (2) does not apply because of subitem (3); and

(b) the Commissioner considers that it is reasonable to conclude that, in working out that allocable cost amount before the 2014 budget time, the head company of the old group included in the step 1 amount mentioned in subsection 711-25(1) of the Income Tax Assessment Act 1997 an amount (the addition to step 1) in respect of the leaving entity’s interest in the underlying securitised assets mentioned in paragraph 711-46(c) of that Act (as inserted by this Schedule).

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

(b) another entity (the disposing entity) ceased to hold *membership interests in the joining entity during the period that:

started 12 months before the joining time; and

ended immediately after the joining time; and

a *CGT event happened because the disposing entity ceased to hold the membership interests; and

either:

a *capital gain or *capital loss of the disposing entity from the CGT event was disregarded because of the operation of Division 855; or

if there had been a capital gain or capital loss of the disposing entity from the CGT event, the capital gain or capital loss would have been disregarded because of the operation of Division 855; and

section 701-10 (cost to head company of assets of joining entity) applies to the joining entity’s assets in respect of the joining entity becoming a subsidiary member of the group (disregarding subsection (2) of this section); and

(f) it is reasonable to conclude that, throughout the period mentioned in paragraph (b), the sum of the *total participation interests held by an entity (the control entity) and its *associates in the joining entity was 50% or more; and

(g) in a case where the control entity is not the disposing entity—it is reasonable to conclude that the sum of the total participation interests held by the control entity and its associates in the disposing entity was 50% or more at the time the CGT event happened.

a particular *direct participation interest; or

a particular *indirect participation interest;

section 701-10 (cost to head company of assets of joining entity);

subsection 701-35(4) (setting value of trading stock at tax-neutral amount);

subsection 701-35(5) (setting value of registered emissions unit at tax-neutral amount).

(a) an entity (the higher level entity) holds *membership interests in the joining entity (whether directly or through one or more interposed entities) at a time during the period mentioned in paragraph (1)(b); and

the higher level entity becomes a *subsidiary member of the *consolidated group at the joining time; and

the requirement in paragraph (1)(b) is not satisfied (disregarding subsection (5)); and

the requirement in paragraph (1)(b) would be satisfied if the reference in paragraph (1)(b) to membership interests in the joining entity included a reference to membership interests in the higher level entity.

the words “the sum of” and “and its *associates” in paragraph (1)(f) of that section were omitted; and

the words “the sum of” and “and its associates” in paragraph (1)(g) of that section were omitted; and

subsection (2) of that section were repealed.

(a) an entity (the leaving entity) ceases to be a *subsidiary member of a *consolidated group at a time (the leaving time); and

(b) a thing (the accounting liability) is, in accordance with *accounting standards, or statements of accounting concepts made by the Australian Accounting Standards Board:

a liability of the leaving entity at the leaving time that can or must be recognised in the entity’s statement of financial position; or

a liability of the *head company of the group at the leaving time that can or must be recognised in the head company’s statement of financial position; and

because subsection 701-1(1) (the single entity rule) ceases to apply to the leaving entity at the leaving time:

(i) if subparagraph (b)(i) applies—the accounting liability becomes a liability of the leaving entity, and an asset (the corresponding asset) that consists of the liability becomes an asset of the head company; or

(ii) if subparagraph (b)(ii) applies—the accounting liability becomes a liability of the head company, and an asset (the corresponding asset) that consists of the liability becomes an asset of the leaving entity; and

the corresponding asset’s *tax cost is set at the leaving time under:

if subparagraph (b)(i) applies—section 701-20; or

if subparagraph (b)(ii) applies—section 701-45; and

the accounting liability is or is part of a *Division 230 financial arrangement.

if subparagraph (1)(b)(i) applies—treat the leaving entity as starting to have the accounting liability at the leaving time for receiving a payment equal to the *tax cost setting amount of the corresponding asset; or

if subparagraph (1)(b)(ii) applies—treat the *head company as starting to have the accounting liability at the leaving time for receiving a payment equal to the tax cost setting amount of the corresponding asset.

(a) an entity (the leaving entity) ceases to be a *subsidiary member of a *consolidated group at a time (the leaving time); and

because subsection 701-1(1) (the single entity rule) ceases to apply to the leaving entity at the leaving time, the asset or liability becomes the asset or liability of:

the leaving entity; or

the *head company of the group; and

if subparagraph (b)(i) applies:

in the case of an asset—subsection 701-55(5A) applies in relation to the asset at the leaving time because of section 701-45; or

in the case of a liability—subsection 715-379(2) applies in relation to the liability at the leaving time; and

if subparagraph (b)(ii) applies:

in the case of an asset—subsection 701-55(5A) applies in relation to the asset at the leaving time because of section 701-20; and

in the case of a liability—subsection 715-379(2) applies in relation to the liability at the leaving time; and

the asset or liability is or is part of a *Division 230 financial arrangement.

in the case of an asset—for the purposes of section 230-60, assume that the leaving entity acquired the asset (as mentioned in subsection 701-55(5A)) at the leaving time in return for the leaving entity starting to have an obligation to provide the payment mentioned in that subsection; and

in the case of a liability—for the purposes of section 230-60, assume that the leaving entity started to have the liability at the leaving time in return for the leaving entity starting to have a right to receive the payment mentioned in subsection 715-379(2).

in the case of an asset—for the purposes of section 230-60, assume that the head company acquired the asset (as mentioned in subsection 701-55(5A)) at the leaving time in return for the head company starting to have an obligation to provide the payment mentioned in that subsection; and

in the case of a liability—for the purposes of section 230-60, assume that the head company started to have the liability at the leaving time in return for the head company starting to have a right to receive the payment mentioned in subsection 715-379(2).

the entity lodged its income tax return for the income year before the 2013 budget time; and

the Commissioner could not amend the assessment in that way if the amendments made by this Part and Part 7 were disregarded; and

the entity has not requested the Commissioner to amend the assessment in that way.

(a) an entity (the leaving entity) ceases to be a *subsidiary member of a *consolidated group (the old group) at a time (the leaving time); and

(b) the asset’s tax cost is set under corresponding liability) owed to the leaving entity.section 701-45 because it consists of a liability (the

unless subsection (3) or (4) applies—the *market value of the asset at the leaving time; or

if subsection (3) applies—nil; or

if subsection (4) applies—the least of the following amounts:

the tax cost setting amount mentioned in paragraph (4)(c);

if the *head company of the old group was entitled to a deduction in respect of the asset for an income year ending on or before the leaving time—the tax cost setting amount mentioned in paragraph (4)(c) reduced by the amount of the deduction;

the market value of the asset at the leaving time.

(a) the corresponding liability is not a debt; and

either:

at the time the corresponding liability arose, the entity to whom the corresponding liability was owed and the entity owing the corresponding liability were both *members of the old group; or

if subparagraph (i) does not apply—after the time the corresponding liability arose, a member of the old group *acquired the asset or started to have the corresponding liability.

(a) the corresponding liability is not a debt; and

(b) at the time the corresponding liability arose, the entity to whom the corresponding liability was owed and the entity owing the corresponding liability were not both members of the old group; and

the *tax cost of the asset was set under section 701-10 at the time an entity became a *subsidiary member of the old group, at the asset’s *tax cost setting amount (whether or not section 701-58 applied in relation to the setting of that tax cost).

an entity ceases to be a subsidiary member of a consolidated group or MEC group under an arrangement that commences before the 2013 budget time; and

the amendments made by this Part apply because of subitem (2).

the entity lodged its income tax return for the income year before the 2013 budget time; and

the Commissioner could not amend the assessment in that way if the amendments made by Part 6 and this Part were disregarded; and

the entity has not requested the Commissioner to amend the assessment in that way.

an entity becomes a subsidiary member of a consolidated group or MEC group; or

an entity that ceases to be a subsidiary member of a consolidated group or MEC group.

for an off-market bid (within the meaning of that Act)—step 4 of the table in subsection 633(1) of that Act is completed; or

for a market bid (within the meaning of that Act)—step 2 of the table in subsection 635(1) of that Act is completed.

a meeting or meetings of a company’s members about the arrangement; or

a meeting or meetings of one or more classes of a company’s members about the arrangement;