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Two or more companies owned by the same shareholders can be treated as a single entity. Wholly owned companies can choose to be treated as a consolidated group of companies.

Consolidating your company

Consolidated, wholly owned groups of companies can:

  • transfer assets within the consolidation group, with deferred income tax liabilities
  • pay exempt dividends between companies
  • claim deductions for administration and other costs of holding companies that may not be deductible to the holding company that incurred the expenditure
  • use losses incurred by group members by referring to shareholding continuity of the group, not of the individual member
  • offset imputation credits within the group, even though ordinary imputation credit rules do not permit the grouping of imputation credits.

Leaving the consolidated group

A company can leave a consolidated group by notifying us.

They will no longer be treated as a member from the beginning of the income year we receive the notice in.

If the company requests it they can be treated as a non-member for the income year after we receive their notice.

Companies can also cease to be a member of a consolidated group when they:

  • lose their eligibility status
  • are no longer entitled to be a member of the same consolidated group
  • belong to a consolidated group that ceases to have a nominated company.