Currency risk and Tax arbitrage: Difference between pages

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The risk of losses or other adverse effects resulting from a change in a foreign exchange rate, or from other unfavourable changes in relation to a foreign currency.
A form of cross-border tax avoidance, or tax planning, which takes advantage of differences in tax between different jurisdictions.
 
 
Examples include:
 
(i) a final receipt/payment of a different amount of domestic currency equivalent, than expected when a currency transaction was committed to (transaction risk), or <br>
(ii) a change in asset/liability values in a balance sheet, profit/loss in an income statement (translation risk), or <br>
(iii) a change in competitiveness as rates change relative to buyers, suppliers or competitors (economic risk).
 
 
A more complex area of foreign exchange risk concerns contingent, or pre-transaction risk.
 
 
Also known as Currency exposure or Foreign exchange risk.




== See also ==
== See also ==
* [[Contingent risk]]
* [[Arbitrage]]
* [[Cross-currency interest rate swap]]
* [[Common Consolidated Corporate Tax Base]]
* [[Currency management]]
* [[Foreign exchange risk]]
* [[Transaction exposure]]
* [[Translation exposure]]
 
 
===Other links===
[http://www.treasurers.org/node/5281 Currency risk, Will Spinney, ACT 2009]
 
[[Category:Manage_risks]]

Revision as of 09:33, 8 April 2015

A form of cross-border tax avoidance, or tax planning, which takes advantage of differences in tax between different jurisdictions.


See also