Can a foreign currency exchange loss be claimed as a tax deduction for an eco-tour business?

 Author: JayATO(Community Support)Community Support

15 May 2026

Hi @Phyo,

Foreign exchange losses incurred by an Australian taxpayer operating an eco-tour business can generally be claimed as a deduction under Division 775 of the ITAA 1997 when the losses are directly related to earning assessable business income. The forex losses must be realised through a forex realisation event and must not be of a private or domestic nature.

For a business operating an eco-tour, if you've incurred USD expenses for overseas tours and the exchange rate fluctuation resulted in a loss, this would typically be deductible. However, you must include all your foreign exchange losses in calculating your business net income or loss in your business income section of your tax return.

For supporting documentation, you'll need to maintain records that demonstrate:

• the original foreign currency transaction and the exchange rate at the time
• the realisation event and the exchange rate at that time
• the calculation of the forex loss
• evidence that the expense was incurred in earning assessable business income.

You can find detailed information about the forex measures and how to calculate your forex losses at Foreign exchange gains and losses.

Reply0 likes

• Report as inappropriate