Income tax, CGT and entities

Tax consolidation

Tax consolidation is a regime under which a wholly-owned corporate group can choose to be treated as a single entity for income tax purposes. One head company lodges the group's income tax return, and the subsidiary members are treated as parts of the head company, so transactions between them are generally ignored for tax. Once the choice is made it cannot be reversed. The rules also deal with what happens when a subsidiary joins or leaves, including the tax cost setting of its assets. The ATO's consolidation pages set out the process and the notification required. A practice looking after a group should check the choice has been notified and kept in the file.

General information, not tax advice. The rules change, so check the source page above for the current position. Fedix is developed by Tax7 R&D Pty Ltd.