MGS Private · Trust Services
Transfers Amongst
Subsidiary Entities
Moving assets or businesses between subsidiary entities within a corporate group raises CGT, GST, duty and corporate law questions — each requiring careful analysis before the transfer is implemented.
Intra-Group Transfers
Moving assets between
related subsidiaries
Transfers of assets between subsidiary entities in a corporate group are not automatically tax-free simply because the entities are related. Each transfer must be analysed for CGT, GST and duty consequences — and available rollovers or concessions must be identified and applied before the transfer occurs.
- CGT on the transfer — is a rollover or concession available?
- Tax consolidated groups — intra-group transfers within a consolidated group are generally disregarded for CGT
- Where consolidation is not in place, standard CGT rules apply to all intra-group transfers
- Division 7A — company transferring assets to a related entity below market value
- GST on the transfer — going concern exemption or taxable supply?
- Stamp duty — corporate reconstruction concessions in each relevant State
- Landholder duty — where the transferred asset includes real property in a company or trust
- Exit charges when an entity exits a consolidated group after receiving intra-group assets
Tax Consolidated Groups
The intra-group transfer framework
Intra-Group Transfers Disregarded
Within a consolidated group, transfers of assets between group members are generally disregarded for CGT purposes — the group is treated as a single entity for tax. This makes intra-group restructuring significantly more efficient within a consolidated group than outside one.
Exit Charges
Where an entity exits a consolidated group after receiving assets via intra-group transfer, exit charge calculations apply — setting the tax cost of the exiting entity’s assets, which may trigger CGT liabilities that were previously disregarded while the entity remained in the group.
Duty Still Applies
Tax consolidation does not provide duty relief on intra-group transfers — duty is a State tax and transfers of dutiable property between group members remain subject to duty unless a specific State reconstruction concession applies independently.
Decision to Consolidate
Where a group has not yet consolidated, the decision to consolidate raises its own CGT questions — particularly around tax cost setting on entry and whether consolidation is beneficial given the existing cost bases of group entities. MGS Private advises on the consolidation entry decision.
Moving assets between related entities within a corporate group?
CGT, GST and duty must all be assessed. Brief MGS Private through your accountant or lawyer.