TOFA: gains and losses relating to exempt income or NANE income - TR 2011/D7
14 Dec 2011
On 14 December 2011, the ATO released for public comment by 17 February 2012 draft Taxation Ruling TR 2011/D7 entitled "Income tax: taxation of financial arrangements - application of ss 230-30(2) and 230-30(3) of ITAA 1997 to gains and losses relating to exempt income or non-assessable non-exempt income".
Section 230-30(3) provides that a loss made from a financial arrangement is not an allowable deduction, to the extent it is made in gaining or producing exempt income or non-assessable non-exempt (NANE) income, unless that loss satisfies the description in subsection 230-15(3).
Section 230-30(2) provides that, despite section 230-15, a gain will be exempt income or NANE income to the extent that, if it had been a loss, it would have been made in gaining or producing NANE income.