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Schedule 6—Extension of temporary loss carry back

Schedule 6 Extension of temporary loss carry back

Part 1 Main amendments

Income Tax Assessment Act 1997

1  Subsection 36-17(1) (note 2)

Omit “2020-21 or 2021-22 income year”, substitute “2020-21, 2021-22 or 2022-23 income year”.

2  Subsection 36-17(1) (note 2)

Omit “or 2020-21”, substitute “, 2020-21 or 2021-2022”.

3  Section 36-25 (table dealing with tax losses of corporate tax entities)

Omit “ or 2021-22 ”, substitute “ , 2021-22 or 2022-23 ”.

4  Division 160 (heading)

Omit “ or 2021-22 ”, substitute “ , 2021-22 or 2022-23 ”.

5  Section 160-1

Omit “2019-20, 2020-21 or 2021-22 against the income tax liability it had for 2018-19, 2019-20 or 2020-21”, substitute “2019-20, 2020-21, 2021-22 or 2022-23 against the income tax liability it had for 2018-19, 2019-20, 2020-21 or 2021-22”.

6  Section 160-1

Omit “refundable tax offset for 2020-21 or 2021-22”, substitute “refundable tax offset for 2020-21, 2021-22 or 2022-23”.

7  At the end of paragraph 160-5(a)

Add:

                        or (iii)  the 2022-23 income year;

8  At the end of paragraph 160-5(c)

Add:

                            (iv)  if the current year is the 2022-23 income year—the 2022-23 income year or the 2021-22 income year;

9  At the end of paragraph 160-5(d)

Add:

                            (iv)  if the current year is the 2022-23 income year and the 2022-23 income year was a loss year—the 2021-22 income year or the 2020-21 income year;

                             (v)  if the current year is the 2022-23 income year and the 2021-22 income year was a loss year—the 2020-21 income year;

10  Section 160-5 (after note 2)

Insert:

Note 2A:    The entity can be entitled to only one loss carry back tax offset for 2022-23. However, that offset has 4 components: one relating to 2018-19, one relating to 2019-20, one relating to 2020-21 and one relating to 2021-22: see section 160-10.

11  At the end of paragraph 160-10(1)(a)

Add:

                     and (iv)  if the current year is the 2022-23 income year—the 2021-22 income year and the 2020-21 income year;

12  Subparagraph 160-10(2)(b)(ii)

Omit “or 3”, substitute “, 3 or 4”.

13  Subsection 160-10(3) (at the end of the heading)

Add “ —entitlement to loss carry back tax offset for 2021-22 income year ”.

14  After subsection 160-10(4)

Insert:

Income tax liability for the 2018-19, 2019-20 or 2020-21 income year already utilised entitlement to loss carry back tax offset for 2022-23 income year

          (4A)  Subsection (4B) applies in relation to applying paragraph (2)(b) to work out the entity’s * loss carry back tax offset component for the 2018-19, 2019-20 or 2020-21 income year (the gain year ) as part of working out the entity’s entitlement to a * loss carry back tax offset for the 2022-23 income year.

          (4B)  Disregard so much of the entity’s * income tax liability for the gain year as has previously been included (as part of working out the entity’s entitlement to a * loss carry back tax offset for the 2020-21 or 2021-22 income year) in a * loss carry back tax offset component.

15  At the end of subsection 160-10(5)

Add:

             ; and (d)  if the current year is the 2022-23 income year:

                              (i)  where the entity carries back an amount to the 2021-22 income year—more than half of the 2021-22 income year; and

                             (ii)  where the entity carries back an amount to the 2020-21 income year—more than half of the 2020-21 income year.

16  Subsection 160-15(1)

Omit “2020-21 or 2021-22 income year”, substitute “2020-21, 2021-22 or 2022-23 income year”.

17  After paragraph 160-15(1)(a)

Insert:

                    (aa)  if the current year is the 2022-23 income year and the 2022-23 income year was a loss year:

                              (i)  how much (expressed as a specified amount) of the entity’s tax loss (if any) for the 2022-23 income year is to be carried back to the 2021-22 income year; and

                             (ii)  how much (expressed as a specified amount) of the entity’s tax loss (if any) for the 2022-23 income year is to be carried back to the 2020-21 income year; and

                            (iii)  how much (expressed as a specified amount) of the entity’s tax loss (if any) for the 2022-23 income year is to be carried back to the 2019-20 income year; and

                            (iv)  how much (expressed as a specified amount) of the entity’s tax loss (if any) for the 2022-23 income year is to be carried back to the 2018-19 income year;

                   (ab)  if the current year is the 2022-23 income year and the 2021-22 income year was a loss year:

                              (i)  how much (expressed as a specified amount) of the entity’s tax loss (if any) for the 2021-22 income year is to be carried back to the 2020-21 income year; and

                             (ii)  how much (expressed as a specified amount) of the entity’s tax loss (if any) for the 2021-22 income year is to be carried back to the 2019-20 income year; and

                            (iii)  how much (expressed as a specified amount) of the entity’s tax loss (if any) for the 2021-22 income year is to be carried back to the 2018-19 income year;

18  At the end of section 160-25 (after the note)

Add:

             (3)  If the * current year is the 2022-23 income year:

                     (a)  the entity cannot * carry back an amount of a * tax loss to the 2018-19 income year unless the entity was a * corporate tax entity throughout:

                              (i)  the 2018-19 income year (disregarding any period when the entity was not in existence); and

                             (ii)  the 2019-20 income year; and

                            (iii)  the 2020-21 income year; and

                            (iv)  the 2021-22 income year; and

                     (b)  the entity cannot carry back an amount of a tax loss to the 2019-20 income year unless the entity was a corporate tax entity throughout:

                              (i)  the 2019-20 income year (disregarding any period when the entity was not in existence); and

                             (ii)  the 2020-21 income year; and

                            (iii)  the 2021-22 income year; and

                     (c)  the entity cannot carry back an amount of a tax loss to the 2020-21 income year unless the entity was a corporate tax entity throughout:

                              (i)  the 2020-21 income year (disregarding any period when the entity was not in existence); and

                             (ii)  the 2021-22 income year; and

                     (d)  the entity cannot carry back an amount of a tax loss to the 2021-22 income year unless the entity was a corporate tax entity throughout the 2021-22 income year (disregarding any period when the entity was not in existence).

Note:          The entity must be a corporate tax entity throughout 2022-23: see paragraph 160-5(b).

19  Paragraph 195-15(5)(c)

Omit “or 2021-22”, substitute “, 2021-22 or 2022-23”.

20  Section 195-37

Omit “or 2021-22”, substitute “, 2021-22 or 2022-23”.

21  Paragraph 320-149(2)(aa)

Omit “or 2021-22”, substitute “, 2021-22 or 2022-23”.

22  Subsection 995-1(1) (note to the definition of carry back )

Omit “or 2021-22”, substitute “, 2021-22 or 2022-23”.

Taxation Administration Act 1953

23  Section 45-340 in Schedule 1 (paragraph (db) of step 1 of the method statement)

Omit “or 2021-22”, substitute “, 2021-22 or 2022-23”.

Part 2 Contingent amendments

Income Tax Assessment Act 1997

24  Subsection 160-16(1)

Omit “or 2021-22”, substitute “, 2021-22 or 2022-23”.