Income Tax Act 2007 section 257MF

The qualifying subsidiaries requirement

Section 257MF requires that any subsidiary held by a social enterprise during the shorter applicable period must be a qualifying subsidiary.

• Any subsidiary of the social enterprise must meet the qualifying subsidiary criteria throughout the shorter applicable period.
• The requirement applies to all subsidiaries held at any point during the relevant time frame, not just those held at a single date.
• The definition of what constitutes a qualifying subsidiary is set out separately in section 257MU.
• If any subsidiary fails to meet the qualifying subsidiary test during the shorter applicable period, the requirement is not satisfied.