Document ID: chunk:federal_register_of_legislation:C2025C00029:section:10:p1
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 10 (pt 1/3)
Character Range: 6869679–6872366

10                    (a) you incurred the obligation, or the part of the obligation, as the second, third, fourth or fifth element of the *cost base of a CGT asset; and                                                                                                                   the time of the transaction under which you incurred the obligation.
                      (b) none of the above items apply

Note 1: Foreign currency is a CGT asset. If you acquire foreign currency as the borrower under a loan, item 8 will apply to your obligation to repay the foreign currency borrowed under the loan.
Note 2: If you have made a choice for roll‑over relief for a facility agreement, and forex realisation event 7 (material variation of a facility agreement) happens, subsection 775‑220(6) modifies the tax recognition time for an obligation under a security that was in existence under the agreement at the time of that event.
Note 3: Subsection 775‑260(2) modifies the tax recognition time if forex realisation event 4 happens in relation to a qualifying forex account that has ceased to pass the limited balance test.
Note 4: If you have made a choice for roll‑over relief for a facility agreement, a forex realisation gain or forex realisation loss you make under the agreement as a result of forex realisation event 4 is disregarded—see section 775‑200.

775‑60  Ceasing to have a right to pay foreign currency—forex realisation event 5

Forex realisation event 5
 (1) Forex realisation event 5 happens if:
 (a) you cease to have a right, or a part of a right, to pay *foreign currency; and
 (b) the right, or the part of the right, is one of the following:
 (i) a right, or a part of a right, created or acquired in return for the assumption of an obligation to pay foreign currency;
 (ii) a right, or a part of a right, created or acquired in return for the assumption of an obligation to pay Australian currency;
 (iii) a right, or a part of a right, under an option to sell foreign currency.
Note 1: For extended meaning of right to pay foreign currency, see section 775‑135.
Note 2: For extended meaning of obligation to pay foreign currency, see section 775‑140.

Time of event
 (2) The time of the event is when you cease to have the right or the part of the right.

Forex realisation gain
 (3) You make a forex realisation gain if:
 (a) the amount you pay in respect of the event happening falls short of the *forex entitlement base of the right or the part of the right (the forex entitlement base is worked out as at the tax recognition time); and
 (b) some or all of the shortfall is attributable to a *currency exchange rate effect.
The amount of the forex realisation