Section DV 16 — Income Tax Act 2007: Consolidated groups: intra-group transactions

DV 16 Consolidated groups: intra-group transactions When this section applies (1) This section applies in relation to a consolidated group of companies for the purposes of section FM 10 (Expenditure: intra-group transactions). No deduction (with exception) (2) A company that is a part of a consolidated group of companies is denied a deduction for expenditure or loss incurred through a payment or disposal to, or transaction or arrangement with, another group company, and a deduction would not be allowed for the expenditure or loss if the group were 1 company, except to the extent to which the expenditure or loss arises— (a) from the company’s acquisition of trading stock; or (b) under sections FM 15 to FM 23 (which relate to accounting for particular property). Other expenditure or loss (3) A company that is part of a consolidated group is— (a) allowed a deduction for expenditure or loss or an amount of depreciation loss: (b) denied a deduction for expenditure or loss or amount of depreciation loss except to the extent to which the expenditure or loss is interest on money that the company has borrowed outside the consolidated group. Link with subpart DA (4) This section overrides the general permission. Defined in this Act: amount , arrangement , company , consolidated group , deduction , depreciation loss , general permission , interest , pay , Compare: 2004 No 35 s HB 2(1)(b), (d)