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RC 29: Residual income tax of consolidated groups
or “How to calculate provisional tax when joining a consolidated group”
You could also call this:

“How to estimate tax when a company joins or leaves a group”

If you are part of a company group for some or all of a tax year, but not part of the group for some or all of the next tax year, you need to follow these rules:

You must estimate how much tax your company will owe by the date of instalment F for the next income year. This is called your residual income tax. You need to do this as if you were a single company, not part of a group.

If your company joins another group, that new group also needs to estimate its residual income tax by the date of instalment F for the next income year.

If you leave your group during the next tax year, your estimate only applies to the tax instalments you need to pay after you’ve left the group.

These rules are part of the provisional tax system, which is a way of paying tax throughout the year instead of all at once.

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Next up: RC 31: Consolidated groups using GST ratio method

or “How tax groups calculate payments using GST ratios when companies join or leave”
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Part R General collection rules
Provisional tax: Table R1: Summary of instalment dates and calculation methods for provisional tax

RC 30Consolidated groups using estimation method

  1. Subsection (2) applies for the purposes of the provisional tax rules if a company is part of a consolidated group of companies for some or all of a tax year but is not part of the group for some or all of the following tax year.

  2. The company must estimate its residual income tax on or before the date of instalment F for the following income year that corresponds to the tax year, and the company is treated as a person to which section RC 7 applies for the purposes of its estimate.

  3. The consolidated group, in the case of a company that is part of another consolidated group, must make an estimate of residual income tax on or before the date of instalment F for the following income year that corresponds to the tax year, and the consolidated group is treated as a person to which section RC 7 applies for the purposes of its estimate.

  4. If a company stops being part of the consolidated group in the following tax year, the company’s estimate applies only to instalments of provisional tax payable after the date on which it stopped being part of the group.

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