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Issues on exiting from a consolidated group presentation


Issues covered in this presentation include:

  • when does an entity exit? - special issues on liquidation and for MEC groups
  • a CGT event L5 if liabilities exceed the tax cost of assets - a problem with insolvent subsidiaries
  • assets which may not have a cost base on exit
  • what is the tax value of intra-group assets and liabilities when an entity leaves a group?
  • issues with merged and split assets and goodwill
  • issues with liabilities and the impact of IFRS, the interaction between s711-45(3) and (5)
  • if Division 149 applies after the formation of a group, what is its effect on the disposal of a subsidiary member with a pre-CGT factor?
  • when is the gain or loss of the head company on the disposal of membership interests
  • in subsidiary member on revenue or capital account.

This was also presented by Paul Abbey at the Tax Consolidation seminar held in Sydney on 22 February 2005.

Author profile:

David is a tax partner with PricewaterhouseCoopers. He was involved in the Government consultations which led to formulation of the original tax consolidation proposal and has maintained a significant involvement ever since, assisting clients with implementation and ongoing issues and participating in the NTLG Consolidation Sub Committee and various of its issue specific working groups.
Current at 9 February 2009 Current at 15 May 2009 Click here to expand/collapse more articles by David ROMANS.


This was presented at Tax Consolidation: an update on emerging issues .

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Issues on exiting from a consolidated group

Author(s):  David ROMANS

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