Document ID: chunk:federal_register_of_legislation:C2010C00611:clause:4_6:p1
Version: federal_register_of_legislation:C2010C00611
Segment Type: clause
Provision Reference: sch 4 cl 6 (pt 1/5)
Character Range: 141828–144507

6                         (a) an increased balance period is the second increased balance period that occurs in a particular income year; and         paragraphs (1)(b) and (c) do not apply during the first 15 days of the first‑mentioned increased balance period.
                          (b) the duration of the period is more than 15 days; and
                          (c) item 1 or 2 applies to the first increased balance period that occurred in the income year

Translation of foreign currency

 (4) For the purposes of the application of section 960‑50 to this section, work out the *foreign currency equivalent of an amount of Australian currency as at a particular time in an income year by translating the foreign currency to Australian currency at the average exchange rate for the third month that preceded the income year.

Debit balances

 (5) For the purposes of this section, a debit balance is to be expressed as a positive amount.

Note: For example, if you owe $1,100 on a credit card account, the debit balance of that account is $1,100.

775‑250  Tax consequences of passing the limited balance test

 (1) A *forex realisation gain or a *forex realisation loss you make as a result of forex realisation event 2 or 4 is disregarded if the event happens in relation to a *qualifying forex account that:
 (a) you hold at the time of the event; and
 (b) passes the limited balance test at the time of the event.

 (2) If CGT event C1 or C2 happens in relation to a *qualifying forex account that:
 (a) you hold at the time of the event; and
 (b) passes the limited balance test at the time of the event;
disregard so much of any *capital gain or *capital loss you make as a result of the event as is attributable to a *currency exchange rate effect.

Note: For currency exchange rate effect, see section 775‑105.

775‑255  Notional realisation when qualifying forex account starts to pass the limited balance test

Credit balance

 (1) For the purposes of this Division, if:
 (a) you hold a *qualifying forex account; and
 (b) at a particular time:
 (i) the account starts to pass the limited balance test; and
 (ii) the account has a credit balance; and
 (iii) you have one or more rights to receive a total amount of *foreign currency represented by the credit balance of the account;
you are treated as:
 (c) having ceased to have those rights at that time; and
 (d) having re‑acquired those rights immediately after that time.

Note: This means that forex realisation event 2 will happen when the account starts to pass the limited balance test.

Debit balance

 (2) For the purposes of this Division, if:
 (a) you hold a *qualifying forex account; and