[CFM61160] CFM61160 – Foreign exchange: tax rules on exchange gains and losses: loan relationships and derivative contracts: special rules on fair value accounting
Identifying exchange gains and losses where fair value accounting is used
The guidance at CFM61030 to CFM61060 applies where a company uses an accruals or amortised cost basis of accounting for a loan relationship or a currency contract. But the definitions of ‘exchange gains and losses’ at CTA09/S475 and CTA09/S606 are not easy to apply where the company uses fair value (or mark to market) accounting. (See CFM21620 for more on fair value accounting).