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Unapplied previous FIF loss

Last updated 31 March 2020

An unapplied previous FIF loss is the amount by which the undeducted amount of a FIF loss is more than the sum of any gross FIF income from your interest in that particular FIF. [subsection 542(6)]

The undeducted amount of a FIF loss is the amount of a FIF loss that has not been allowed as a deduction from your assessable income. [section 532 and subsection 542(6)]

You may include losses that arose in relation to the FIF even though one of the following FIF exemptions applied:

  • an attributable taxpayer under the CFC and transferor trust measures
  • a foreign company engaged in active business
  • a foreign bank
  • a life insurance company
  • a general insurance company
  • certain companies engaged in commercial activities associated with real property
  • small investors
  • employer-sponsored superannuation
  • complying superannuation entities and interests in certain assets of life insurance companies and certain fixed trusts.

Once you have used a FIF loss to work out if there was, for any notional accounting period, an unapplied previous FIF loss, you cannot use that loss again in later notional accounting periods. [subsection 542(7)]

In working out your unapplied previous FIF losses, apply only that gross FIF income accruing after the notional accounting period in which you incurred the loss and before the current notional accounting period in which you have a gross FIF income. [subsection 542(5)]

Box G

Take away the amount in F from the amount in E. This gives you your FIF income.

Box H

Convert your FIF income to Australian dollars at the rate of exchange applying at the end of the relevant notional accounting period. Insert the converted amount at H.

The amount at H is your FIF income. Include it in your assessable income after allowing for a reduction for assessable distributions from the FIF. Read Chapter 6: Avoiding double taxation for more information.

Boxes I, J and K

If any of the distributions referred to above are dividends, interest payments or trust distributions, or your FIF interest relates to shares acquired under an employee acquisition scheme - see Reduction of FIF income for FIF interests acquired under an employee share scheme in chapter 6 - use I, J and K to arrive at the amount to include in your assessable income. [sections 530, 530A and 603]

If you are entitled to a reduction of FIF income, add the amount of the reduction to any amount at J.