Deductibility of losses from a foreign currency loan

The Austrian Fiscal Court qualifies losses resulting from the conversion of a foreign currency loan as negative income from capital assets. When a taxpayer preserves an operating income only half of the losses were accepted as tax deduction (with effect from 01.01.2016 at 55%). In the sense of § 27 (3) EStG (Austrian Income Tax Act) the decisive factor is whether an asset is according to its design aimed to generate income from the surrender of capital. [BFG [Austrian Fiscal Court] 25.04.2016, RV/2101137/2015]