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  • How to calculate deductions for a capital protected borrowing

    The way a capital protected product or borrowing is treated for tax purposes depends on:

    • whether a product ruling applies to it
    • the date the arrangement was entered into or extended
    • whether it provides capital protection by way of a limited recourse loan only, or another method.

    Work out which treatment applies

    To work out which treatment applies to your product follow the following steps.

    Step 1 – Does a product ruling cover the arrangement?

    Step 2 – Was the capital protected product or borrowing entered into or extended before 9.30am on 16 April 2003?

    Step 3 – Was the capital protected product or borrowing entered into or extended on or after 9.30am on 16 April 2003 but before 1 July 2007?

    Step 4 – Was the capital protected product or borrowing entered into or extended on or after 1 July 2007 but before 13 May 2008?

    Step 5 – The capital protected product or borrowing was entered into or extended after 13 May 2008 – go to Entered into or extended on or after 13 May 2008

      Last modified: 19 Aug 2016QC 17547