Document ID: chunk:federal_register_of_legislation:C2025C00029:section:4:p7
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 4 (pt 7/55)
Character Range: 3815574–3818127

or domestic purpose
 (1) Subsections (2) and (3) apply if:
 (a) a *borrowing is made by you, or credit is provided to you, under a *financial arrangement; and
 (b) you use some or all of the funds borrowed or the credit provided for a private or domestic purpose.
 (2) This Division does not apply to a gain you make from the arrangement to the extent that you use the funds raised or the credit provided for a private or domestic purpose.
 (3) A loss you make from the arrangement is not allowable as a deduction to you under any provision of this Act to the extent that you use the funds raised or the credit provided for a private or domestic purpose.

Derivative financial arrangement held for private or domestic purpose
 (4) Subsections (5) and (6) apply if:
 (a) you are an individual; and
 (b) you make a gain or loss from a *derivative financial arrangement; and
 (c) the arrangement is held, wholly or in part, for a private or domestic purpose.
 (5) This Division does not apply to a gain you make from the arrangement to the extent that the arrangement is held or used for a private or domestic purpose.
 (6) A loss you make from the arrangement is not allowable as a deduction to you under any provision of this Act to the extent that the arrangement is held or used for a private or domestic purpose.

Method to be applied to take account of gain or loss

230‑40  Methods for taking gain or loss into account

Methods available
 (1) The methods that can be applied to take account of a gain or loss you make from a *financial arrangement are:
 (a) the accruals and realisation methods provided for in Subdivision 230‑B; or
 (b) the fair value method provided for in Subdivision 230‑C; or
 (c) the foreign exchange retranslation method provided for in Subdivision 230‑D; or
 (d) the hedging financial arrangement method provided for in Subdivision 230‑E; or
 (e) the method of relying on your financial reports provided for in Subdivision 230‑F; or
 (f) a balancing adjustment provided for in Subdivision 230‑G.
Note: The methods referred to in paragraphs (b) to (e) only apply if you make an election under the relevant Subdivision and you must meet certain requirements before you can make such an election.
 (2) A gain or loss is not taken into account under any of the methods referred to in paragraphs (1)(a), (b), (c) and (e) to the extent to which it is taken into account under the method referred to in paragraph (1)(f) (balancing adjustment).
 (3) A gain or loss is not taken into account under the method referred to in paragraph