(1) This Subdivision has effect for the head company core purposes set out in subsection 701-1(2) if one or more entities become * subsidiary members of a * consolidated group at the time (the formation time ) it comes into existence as a consolidated group.
Note: This is the first exception to Subdivision 705-A: see paragraph 705-15(a).
(2) The object of this Subdivision is to modify the rules in Subdivision 705-A (which basically determine the tax cost setting amount for assets of an entity joining an existing * consolidated group) so that they have effect, and take account of different circumstances that apply, when a consolidated group comes into existence.
Note: The main circumstance is where one of the entities has membership interests in another. In such a case, the order in which the rules in Subdivision 705-A are applied will affect the tax cost setting amounts for the assets of the entities.
Modified application of Subdivision 705-A