Election for portfolio treatment of fees, premiums and discounts
What is this election?
You can elect for portfolio treatment under the accruals method for fees, premiums and discounts associated with certain financial arrangements where the arrangements are part of a portfolio of similar financial arrangements.
This is an irrevocable election to spread the portfolio fees, premiums and discounts over the expected life of the portfolio the financial arrangement is a part of.
To be eligible to make the election for portfolio treatment of fees, premiums and discounts, you must prepare financial reports in accordance with the relevant accounting standards and have these reports audited in accordance with the relevant auditing standards.
- Information, refer to sections 230-160 and 230-165 of the Income Tax Assessment Act 1997 (ITAA 1997).
How do you make this election?
To make this election, download and complete the TOFA 3 & 4 election for portfolio treatment of fees, discounts and premiums form (NAT 73734).
You do not have to notify us of this election, but you should keep a copy of it with your tax records.
You can make this election at any time – however, it will generally only apply to financial arrangements you start to have in the income year you make the election or later income years.
Explains what the election for portfolio treatment of fees, premiums and discounts is, the eligibility requirements, and how to make this election.