Income Tax Assessment Act 1997

CHAPTER 4 - INTERNATIONAL ASPECTS OF INCOME TAX  

PART 4-5 - GENERAL  

Division 775 - Foreign currency gains and losses  

Subdivision 775-C - Roll-over relief for facility agreements  

Operative provisions

SECTION 775-220   Material variation of a facility agreement - forex realisation event 7  

Forex realisation event 7

775-220(1)    
Forex realisation event 7 happens if:

(a) a material variation is made to the terms or conditions of a *facility agreement; or

(b) a material variation is made to the effect of a facility agreement; or

(c) a material variation is made to the type or types of security that can be issued under a facility agreement;

so long as you have made a choice for roll-over relief for the facility agreement, and that choice is in effect.

Note:

See also subsections (7) and (8).

Time of the event

775-220(2)    
The time of the event is when the material variation happens.

Forex realisation gain

775-220(3)    
You make a forex realisation gain if:

(a) the total of the forex realisation gains that you would have made as a result of forex realisation event 6 if you had, at the time of forex realisation event 7:

(i) discharged your liabilities under each of the notional loans to which the agreement relates; and

(ii) not rolled-over any *eligible security;

exceeds:

(b) the total of the forex realisation losses that you would have made as a result of forex realisation event 6 if you had, at the time of forex realisation event 7:

(i) discharged your liabilities under each of the notional loans to which the agreement relates; and

(ii) not rolled-over any eligible security.

The amount of the forex realisation gain is the amount of the excess.

Note:

See also subsection (9).

Forex realisation loss

775-220(4)    
You make a forex realisation loss if:

(a) the total of the forex realisation losses that you would have made as a result of forex realisation event 6 if you had, at the time of forex realisation event 7:

(i) discharged your liabilities under each of the notional loans to which the agreement relates; and

(ii) not rolled-over any *eligible security;

exceeds:

(b) the total of the forex realisation gains that you would have made as a result of forex realisation event 6 if you had, at the time of forex realisation event 7:

(i) discharged your liabilities under each of the notional loans to which the agreement relates; and

(ii) not rolled-over any eligible security.

The amount of the forex realisation loss is the amount of the excess.

Note:

See also subsection (9).

Termination of choice

775-220(5)    
If forex realisation event 7 happens in relation to a *facility agreement:

(a) your choice for roll-over relief for the facility agreement ceases to have effect immediately after the event; and

(b) you are not entitled to make a fresh choice for roll-over relief for the facility agreement.

Modification of tax recognition time

775-220(6)    
If:

(a) forex realisation event 7 happens in relation to a *facility agreement; and

(b) an *eligible security issued by you under the facility agreement was in existence at the time of that event; and

(c) at a later time, forex realisation event 4 happens because you cease to have an obligation, or a part of an obligation, to pay *foreign currency under the security;

section 775-55 applies to you as if the tax recognition time for the obligation, or the part of the obligation, were the time of forex realisation event 7 (despite subsection 775-55(7) ).

Material variation

775-220(7)    
To avoid doubt, if a variation to:

(a) the terms or conditions of a facility agreement; or

(b) the effect of a facility agreement;

results in the agreement ceasing to be a facility agreement, the variation is taken to be a material variation for the purposes of subsection (1).

775-220(8)    
The regulations may provide that a specified kind of variation is taken to be a material variation for the purposes of subsection (1).

Total amount

775-220(9)    
To avoid doubt, the total amount referred to in paragraph (3)(b) or (4)(b) may be zero.