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TOFA legislation

Amends the operation of the consolidations regime and the taxation of financial arrangements (TOFA) rules.

Last updated 26 January 2016

Tax and Superannuation Laws Amendment (2013 Measures No. 2) Act 2013

These amendments clarify and refine the operation of certain aspects of the Taxation of financial arrangements (TOFA) rules which relate to the core rules, tax-timing methods (accruals and realisation, fair value, hedging financial arrangements), transitional balancing adjustments and eligibility requirements for making certain elections. The amendments apply retrospectively from 26 March 2009, when the TOFA rules started.

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Tax Laws Amendment (2012 Measures No. 2) Act 2012

These amendments alter the rules governing the operation of the interaction between the consolidations regime and the TOFA rules. The amendments apply retrospectively from 26 March 2009, when the TOFA rules started.

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Tax Laws Amendment (2011 Measures No. 7) Act 2011 (147 of 2011)

These amendments alter the definition of instalment income of certain taxpayers under the pay-as-you-go regime to include net TOFA gains. The amendments generally apply from the first instalment quarter of an income year following the lodgment of the first income tax return in which a taxpayer reported an assessable gain or deductible loss from their Division 230 financial arrangements.

The amendments also provide the Commissioner with a limited discretion to extend the time for a taxpayer to notify the Commissioner of the making of a transitional election.

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Income Tax Assessment Amendment Regulations 2011 (No. 4)

These amendments give you additional time to comply with a certain aspect of the tax hedge record-keeping requirements relating to the tax allocation of gains and losses from hedging financial arrangements. The amendments are taken to have commenced on 26 March 2009, when the TOFA rules started.

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Tax Laws Amendment (2010 Measures No. 4) Act 2010

These amendments make minor policy refinements, technical amendments, and minor technical corrections to address drafting oversights. They relate to the scope of the term ‘cash settlable’, the deductibility of dividends on certain shares that are debt interests, and the tax-timing methods (accruals and realisation, hedging, and foreign currency retranslation). The amendments apply for income years commencing on or after 1 July 2010, unless a taxpayer elects to apply Division 230 for income years commencing on or after 1 July 2009.

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Tax Laws Amendment (Taxation of Financial Arrangements) Act 2009

These amendments insert Division 230 Taxation of Financial Arrangements into the Income Tax Assessment Act 1997, as well as consequential and transitional provisions. Division 230 defines 'financial arrangement' and sets out the tax-timing methods (accruals, realisation, fair value, retranslation, hedging and financial reports) under which gains and losses from financial arrangements will be brought to account for tax purposes.

The amendment constitutes Stages 3 & 4 of the TOFA reforms, which were first announced in the 1992 budget and approved by Government on 11 November 1999 for implementation.

Division 230 commenced on 26 March 2009 and applies for income years commencing on or after 1 July 2010 or, where a taxpayer makes an election to apply Division 230 early, for income years commencing on or after 1 July 2009

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QC47856