Disregard an entity's * capital gain or * capital loss from a * CGT event that happens under the demutualisation if:
(a) the entity is established solely for the purpose of participating in the demutualisation and is not a lost policy holders trust (see section 316- 155); and
(b) the CGT event:
(i) happens before or at the same time as the allocation or distribution of the accumulated surplus of the * friendly society; and
(ii) is connected to that allocation or distribution.
Note: The allocation or distribution of the accumulated surplus could happen through an arrangement involving more than one transaction.
Guide to Subdivision 316-C