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Market value and deemed rate of return methods

Last updated 14 May 2020

You cannot get credits for foreign taxes if the FIF income is worked out under the market value or deemed rate of return methods.

In these cases, credits for foreign tax will apply only when distributions are received from the FIF. The current foreign tax credit system rules, as outlined above, apply to these distributions.

Calculation method

A foreign tax credit is allowable for taxpayers who use the calculation method to work out the amount of FIF income to include in their assessable income. However, it is limited to situations where:

  • the FIF is a company which is related to a company taxpayer [sections 160AFCE and 160AFCF]
  • the taxpayer is a beneficiary of a FIF which is a trust estate. [sections 160AFCG and 160AFCH]