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  • Taxation Determination TD 2020/7

    We have now published Taxation Determination 2020/7 Income tax: can capital gains be included under subparagraph 770-75(4)(a)(ii) of the Income Tax Assessment Act 1997 in calculating the foreign income tax offset limit?

    The Taxation Determination is in response to some taxpayers incorrectly including foreign capital gains where no foreign tax has been paid as ‘disregarded income’ in their calculation of the foreign income tax offset (FITO) limit and therefore over-claiming FITO. Over-claiming FITO is one of the drivers of the large superannuation fund income tax gap.

    The matters addressed in the Taxation Determination are complex and have been finalised following extensive public consultation, including with industry, tax professions and interested associations.

    We encourage those affected by the Taxation Determination to read it in full and seek advice on how it applies to their situation.

    Next steps:

    • TD 2020/7 Income tax: can capital gains be included under subparagraph 770-75(4)(a)(ii) of the Income Tax Assessment Act 1997 in calculating the foreign income tax offset limit?
    • If you have any questions or require further information about how TD 2020/7 may apply to your circumstances, email us at PGIPAGUnit@ato.gov.au

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      Last modified: 27 Aug 2020QC 63493