Tax return disclosures
Entities to which the TOFA rules apply are required to report their TOFA gains and TOFA losses in specified labels when lodging their income tax returns.
Generally, entities should report TOFA income in the relevant calculation label in their tax return – for example, interest income should be reported at the interest income label, irrespective of whether it is a TOFA gain.
In addition to the calculation labels, entities applying the TOFA rules are required to complete labels to disclose their total TOFA gains and total TOFA losses, and, in their first TOFA year, unrealised gains from fair value movements in the value of financial arrangements.
The TOFA labels in income tax returns refer to TOFA Stages 3 and 4 (Division 230 and transitional provisions), and foreign exchange gains and losses should only be included in these labels where they are brought to account under Division 230.