Part I
Treatment of tax losses
Attributed controlled foreign company net losses and foreign investment fund net losses
IQ 2CEffect of FIF net loss if attributed FIF income method not available
This section applies for a person and a country (the jurisdiction) when—
- the person has an amount (the available BE loss) of FIF net loss calculated using the branch equivalent method—
- relating to a tax year (the loss year) before the first tax year for which this section applies to the person; and
- relating to a FIF that is resident in the jurisdiction in the loss year; and
- carried forward to a tax year (the current year) in which this section applies to the person; and
- relating to a tax year (the loss year) before the first tax year for which this section applies to the person; and
- the person is not able to use the attributable FIF income method in the current year for the person's interest in the FIF; and
- the person would be able to use the attributable FIF income method in the current year for the person's interest in the FIF if the interest met the requirements of section EX 46(3)(a)(ii) (Limits on choice of calculation methods); and
- the person does not have an income interest of 10% or more in a CFC in the jurisdiction in the current year; and
- the person does not have an attributing interest in a FIF in the jurisdiction in the current year for which the person can use the attributable FIF income method.
The person's available BE loss is available to be subtracted from the person's FIF income, to the extent of the FIF income, in the current year from the FIF, if the FIF is resident in the jurisdiction in the current year.
If the person cannot use all of the available BE loss in the current year, the surplus is available to be carried forward for use under subsection (2) in another tax year.
Notes
- Section IQ 2C: inserted (with effect on 1 July 2011 and applying for income years beginning on or after that date), on , by section 67(1) of the Taxation (Livestock Valuation, Assets Expenditure, and Remedial Matters) Act 2013 (2013 No 52).