Section IE 3 — Income Tax Act 2007: Treatment of tax losses by amalgamated company

IE 3 Treatment of tax losses by amalgamated company When this section applies (1) This section applies if an amalgamated company that meets the requirements of section IA 5 (Restrictions on companies’ loss balances carried forward) has a loss balance carried forward to the tax year in which the amalgamation takes place, and the loss balance— (a) has not, before the date of amalgamation, been used by the company; and (b) could be made available under and subtracted by each amalgamating company from the net income attributable to the part of the relevant company’s tax year that ends with the date of amalgamation. Loss balances carried forward (2) If the requirements of sections IA 5 , IC 2 , and IC 5 (which relate to the use and grouping of tax losses) are met, the amalgamated company’s loss balance is carried forward to the tax year in which the amalgamation takes place or to a later tax year. Attributed CFC net losses and FIF net losses (3) For the purposes of subsection (1)(b), if the tax loss is an attributed controlled foreign company (CFC) net loss or a foreign investment fund (FIF) net loss, it may be made available only to a wholly-owned group of companies. Relationship with sections IA 3 and IA 4 (4) This section overrides sections IA 3 and IA 4 (which relate to the general use of tax losses). Defined in this Act: amalgamated company , amalgamating company , amalgamation , attributed CFC net loss , FIF net loss , loss balance , net income , tax loss , tax year , wholly-owned group of companies , Compare: 2004 No 35 s IF 6