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INCOME TAX ASSESSMENT ACT 1997 - SECT 719.4

What this Subdivision is about

A MEC group and a potential MEC group each consist of certain Australian - resident entities that are wholly - owned subsidiaries of a foreign top company.

A company that is a first - tier subsidiary of the top company is a tier - 1 company.

A MEC group cannot be formed unless there are at least 2 tier - 1 companies of the top company that are eligible to be members of the group.

A MEC group becomes consolidated at a time chosen by the eligible tier - 1 companies.

One of the eligible tier - 1 companies becomes the head company of the group.

The remaining members of the group are the subsidiary members.

Table of sections

Basic concepts

719 - 5   What is a MEC group ?

719 - 10   What is a potential MEC group?

719 - 15   What is an eligible tier - 1 company ?

719 - 20   What is a top company and a tier - 1 company ?

719 - 25   Head company, subsidiary members and members of a MEC group

719 - 30   Treating entities as wholly - owned subsidiaries by disregarding employee shares

719 - 35   Treating entities held through non - fixed trusts as wholly - owned subsidiaries

719 - 40   Special conversion event--potential MEC group

719 - 45   Application of sections   703 - 20 and 703 - 25

Choice to consolidate a potential MEC group

719 - 50   Eligible tier - 1 companies may choose to consolidate a potential MEC group

719 - 55   When choice starts to have effect

Provisional head company

719 - 60   Appointment of provisional head company

719 - 65   Qualifications for the provisional head company of a MEC group

719 - 70   Income year of new provisional head company to be the same as that of former provisional head company

Head company

719 - 75   Head company

Notice of events affecting group

719 - 76   Notice of choice to consolidate

719 - 77   Notice in relation to new eligible tier - 1 members etc.

719 - 78   Notice of special conversion event

719 - 79   Notice of appointment of provisional head company after formation of group

719 - 80   Notice of events affecting MEC group

Effects of change of head company

719 - 85   Application

719 - 90   New head company treated as substituted for old head company at all times before the transition time

719 - 95   No consequences of old head company becoming, and new head company ceasing to be, subsidiary member of the group


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