Document ID: chunk:federal_register_of_legislation:C2025C00029:section:6:p2
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 6 (pt 2/22)
Character Range: 6945505–6948241

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
 (b) at a particular time:
 (i) the account starts to pass the limited balance test; and
 (ii) the account has a debit balance; and
 (iii) you have one or more obligations to pay a total amount of *foreign currency represented by the debit balance of the account;
you are treated as:
 (c) having ceased to have those obligations at that time; and
 (d) having started to again owe those obligations immediately after that time.
Note: This means that forex realisation event 4 will happen when the account starts to pass the limited balance test.

775‑260  Modification of tax recognition time

Forex realisation event 2
 (1) If:
 (a) forex realisation event 2 happens in relation to a *qualifying forex account that:
 (i) you hold at the time of the event; and
 (ii) does not pass the limited balance test at the time of the event; and
 (b) apart from this subsection, the tax recognition time, worked out using the table in subsection 775‑45(7), happened at a time when the account passed the limited balance test;
section 775‑45 applies to you as if the tax recognition time were the most recent time before the forex realisation event when the account ceased to pass the limited balance test (despite subsection 775‑45(7)).

Forex realisation event 4
 (2) If:
 (a) forex realisation event 4 happens in relation to a *qualifying forex account that:
 (i) you hold at the time of the event; and
 (ii) does not pass the limited balance test at the time of the event; and
 (b) apart from this subsection, the tax recognition time, worked out using the table in subsection 775‑55(7), happened at a time when the account passed the limited balance test;
section 775‑55 applies to you as if the tax recognition time were the most recent time before the forex realisation event when the account ceased to pass the limited balance test (despite subsection 775‑55(7)).

Subdivision 775‑E—Retranslation for qualifying forex accounts

Guide to Subdivision 775‑E

775‑265  What this Subdivision is about
      If you choose retranslation for a qualifying forex account:

                (a) a forex realisation gain or a forex realisation loss you make in relation to the account as a result of forex realisation event 2 or 4 is disregarded; and
                (b) forex realisation event 8 enables any gains or losses to be worked out on a retranslation basis.

Table of sections

Operative provisions
775‑270 You may choose retranslation for a qualifying forex account
775‑275 Withdrawal of choice
775‑280 Tax