Lodgment Obligations
- The head company of a consolidated group lodges a single income tax return on behalf of the group.
- Where a group consolidates part way through an income year, the head company lodges a single return covering both its own activities up to the date of consolidation and the group’s activities from the date of consolidation.
- An entity that is a subsidiary member of a consolidated group for the entire income year is not required to lodge an income tax return.
- But an entity that is a subsidiary member of a consolidated group for only part of an income year must lodge an income tax return accounting for the period (or periods) in which it was not part of a group. In these circumstances, the entity lodges a single return for the entire income year at the normal lodgment time but includes only income and deductions attributable to the non-membership period (or periods).
Eligibility
The head company must:
- be an Australian resident (but not a prescribed dual resident) company
- not be a subsidiary member of a consolidated group or a group that is eligible to consolidate
- have at least some of its taxable incomes (if any) taxed at the general company tax rate.
- A corporate unit trust or public trading trust that elects to be taxed like a company may be a head company.
A subsidiary member must:
- be a company, trust or partnership
- be wholly owned (either directly or indirectly) by the head company (disregarding finance shares that are a debt interest and up to 1% of ordinary shares that meet certain employee share scheme requirements)
- be an Australian resident (but not a prescribed dual resident)
- have at least some of its taxable incomes (if any) taxed at the general company tax rate (if a company).
Consolidation of Income Tax Returns
