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Taxation of financial arrangements (TOFA)

Last updated 9 September 2010

New TOFA rules have been introduced to modernise the tax treatment of financial arrangements.

The rules will generally not apply to individuals, they are intended for large entities with complex financial arrangements. For more information about the TOFA rules, see Guide to the taxation of financial arrangements (TOFA) rules.

Where the TOFA rules apply, they will have the following key impacts on CGT:

  • They may operate to modify the cost base or capital proceeds of a CGT asset.
  • A capital gain or capital loss made from a CGT asset that is a financial arrangement may be disregarded.
  • Certain gains and losses from hedging financial arrangements may be taxed under the CGT rules.