Income Tax Assessment Act 1997

CHAPTER 4 - INTERNATIONAL ASPECTS OF INCOME TAX  

PART 4-5 - GENERAL  

Division 832 - Hybrid mismatch rules  

Subdivision 832-K - Modifications for Division 230 (about taxation of financial arrangements)  

Operative provisions

SECTION 832-790   Modifications relating to Division 230 gains and losses  

832-790(1)    
This section applies to the following:

(a) a gain that, apart from this Division, would be included in an entity ' s assessable income for an income year under Division 230 ;

(b) a loss that, apart from this Division, would be allowable as a deduction to an entity for an income year under Division 230 ;

(c) a gain or a loss that, apart from this Division, would be dealt with in accordance with subsection 230-310(4) in relation to an income year.

Separation of currency effects for Division 230 gains and losses

832-790(2)    
For the purposes of this Division, split a gain into 2 separate gains, or a gain and a loss, as follows:

(a) to the extent to which the gain represents a *currency exchange rate effect, treat it as a separate gain or loss;

(b) to the extent that it does not represent that effect, treat it as a separate gain or loss from the *financial arrangement to which this Division applies.

832-790(3)    
For the purposes of this Division, split a loss into 2 separate losses, or a gain and a loss, as follows:

(a) to the extent to which the loss represents a *currency exchange rate effect, treat it as a separate gain or loss;

(b) to the extent that it does not represent that effect, treat it as a separate gain or loss from the *financial arrangement to which this Division applies.

832-790(4)    
For the purposes of this Division, assume an amount treated under paragraph (2)(b) or (3)(b) as a separate loss would, apart from this Division, be allowable as a deduction to the entity for the income year.

This Division applies to a non-currency component that is a gain

832-790(5)    
If there is an amount treated under paragraph (2)(b) or (3)(b) as a separate gain from a *financial arrangement, the gain is treated as consisting of any actual payments made under the financial arrangement and taken into account in working out the amount of the gain or loss the entity made under the arrangement.

832-790(6)    
For the purposes of this Division, assume the gain is an amount that, subject to Division 6 (about effect of foreign residence), is included in the entity ' s assessable income.