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We will take these into account to work out your TPI and your income averaging. Do not include any amounts already shown at item 1 , 2 , 13 , 14 or 15 on your tax return. If you have not shown your TPI at other items on your tax return, you must include it at V item You do not need to work out your tax payable with income averaging. We will work it out from the amount at Z item 24 on your tax return.
If you want to work it out for yourself, follow these steps:. Add your ATPI to your taxable income that is not subject to income averaging your taxable non-professional income. To work out the tax payable on this income:. The result is your total tax payable. Kevin transfers the amount at c to Z item 24 on his tax return supplementary section and, if he has not already included any of this amount at item 1 , 2 , 13 , 14 or 15 , he also writes it at V item 24 on his tax return supplementary section.
For general tax information and up-to-date and comprehensive information about deductions, explore this site. Show download pdf controls. More information on how to apply your capital losses is in step 8 of Part B Sale of shares or units , and step 4 of Part C Distributions from managed funds.
You make a capital gain or a capital loss if a CGT event happens. The disposal of an asset is an example of a CGT event. You can also make a capital gain if a managed fund or other trust distributes a capital gain to you. You write the total of your current year capital gains at H item 18 on your Tax return for individuals supplementary section You write your net capital gain at A item 18 on your tax return supplementary section. This guide only covers capital gains or capital losses from CGT assets that are shares, units or other interests in managed funds. Australian residents can make a capital gain or capital loss if a CGT event happens to any of their assets anywhere in the world.
You need to keep good records of any assets you have bought or sold so you can correctly work out the amount of capital gain or capital loss you have made when a CGT event happens. You must keep these records for five years after the CGT event has happened. You should also keep records relevant to a net capital loss that you carry forward as part of unapplied net capital losses.
You may be able to apply this net capital loss against a capital gain in a later year.
CGT events are the different types of transactions or events that may result in a capital gain or capital loss. A CGT event has happened if you have sold or otherwise disposed of your shares or units or other assets during — For more information about CGT events, see the Guide to capital gains tax If a managed fund makes a capital gain and distributes part of that gain to you, you are treated as if you made a capital gain from a CGT event.
If you did not make a capital gain or capital loss from a CGT event during —13, print X in the NO box at G item 18 on your tax return supplementary section. If the CGT event happened to your shares or units and the event is covered in this guide see About this guide , read on. Otherwise, see the Guide to capital gains tax The timing of a CGT event is important because it determines which income year you show your capital gain or capital loss in.
If you sell or otherwise dispose of an asset to someone else, the CGT event happens when you enter into the contract of sale. If you received a distribution of a capital gain from a managed fund, you are taken to have made the capital gain in the income year shown on your statement from the managed fund. There are three ways of calculating your capital gain or capital loss from the sale of your shares or units:. The indexation method allows you to increase the amount that your asset cost the cost base by applying an indexation factor that is based on increases in the consumer price index CPI up to September The indexation method can only be applied to assets that you acquired before For assets that qualify for both the indexation and discount methods, you can choose the method that gives you the better result.
You do not have to choose the same method for all your shares or units even if they are in the same company or fund. Because you must offset capital losses against capital gains before you apply the CGT discount, your choice may also depend on the amount of capital losses that you have available, see example You make a capital loss from the sale of your shares or units if their reduced cost base is greater than your capital proceeds.
You cannot index amounts included in your reduced cost base. If you received a distribution of a capital gain from a managed fund, part C of this guide explains how you calculate the amount of that capital gain. You must use the same method as that chosen by the fund. Use only with assets acquired before Apply the relevant indexation factors see CPI table , then subtract the indexed cost base from the capital proceeds see the worked examples in chapter B2.
Subtract the cost base from the capital proceeds, deduct any capital losses, then divide by two see the worked examples in chapter B2.
Subtract the cost base from the capital proceeds see the worked examples in chapter B2. There may be an exemption that allows you to disregard your capital gain or capital loss. There may be a rollover that allows you to defer your capital gain or capital loss.
For example, if a company in which you hold shares is taken over or merges with another company, you may have a CGT obligation if you are required to dispose of your existing shares. If you exchanged your existing shares for shares in the takeover company this income year, you may be able to defer or roll over some or all of your capital gain but not a capital loss until a later CGT event happens to your replacement shares. This is known as scrip-for-scrip rollover. Another example of a rollover is when you transfer a CGT asset to your former spouse married or de facto as a result of a court order after a marriage or relationship breakdown.
In this case, you do not make a capital gain or capital loss on the transfer. Your former spouse may make a capital gain or capital loss when a later CGT event happens to the asset. For more information on marriage or relationship breakdown go to Marriage or relationship breakdown and transferring of assets. A rollover is also available for some demergers of corporate or trust groups. If you have sold assets other than shares and units, have assets from a deceased estate or have several CGT events this income year, this publication does not provide you with enough detail.
See Guide to capital gains tax to find out how to calculate and report your CGT obligations. Most of the records you need to keep to work out your capital gain or capital loss when you dispose of shares in companies or units in unit trusts including managed funds will be given to you by the company, the unit trust manager or your stockbroker.
It is important that you keep everything they give you about your shares and units. These words are explained in Definitions. To calculate your capital gain from the sale of shares, or units in a unit trust for example, a managed fund , the three main steps are:. If you received more from the CGT event than the asset cost you that is, the capital proceeds are greater than the cost base , the difference is your capital gain. The three ways of calculating your capital gain are described in step 3 of part A. Generally, for shares, the cost base and reduced cost base are the same.
However, they will be different if you choose the indexation method, because the reduced cost base cannot be indexed. If the capital proceeds are less than the cost base but more than the reduced cost base, you have not made a capital gain or a capital loss. You may find it easier to follow the worked examples in chapter B2. The capital proceeds are what you receive, or are taken to receive, when you sell or otherwise dispose of your shares or units.
For more information, see part A or the worked examples in chapter B2. You may also need to reduce the cost base for an asset such as a share or unit by the amount of any non-assessable payment you received from the company or fund during the time you owned the share or unit.
This is explained in part B3 shares and part C2 units.
For more information on how to determine your cost base and reduced cost base, see the Guide to capital gains tax If you did not make a capital gain, you need to calculate a reduced cost base of your asset before you can work out any capital loss. For units, you may need to make adjustments to the cost base and reduced cost base depending on the types of amounts distributed. Your fund should advise you of these amounts in its statements:.
If the capital proceeds are less than the reduced cost base, the difference is your capital loss. If the capital proceeds are less than or equal to the cost base but more than or equal to the reduced cost base, you have not made a capital gain or a capital loss. Write the total of the capital gains for all your assets for the current year at H item 18 on your tax return supplementary section. If you had a distribution of capital gains from a managed fund, include this in your total capital gains.
See step 3 in chapter C1. If you have any capital losses, do not deduct them from the capital gains before writing the total amount at H. Fred does not have any other capital gains. If you do not have any capital losses from assets you disposed of this year or unapplied net capital losses from earlier years, go to step 9. If you made any capital losses this year, deduct them from the amount you wrote at H. If you have unapplied net capital losses from earlier years, deduct them from the amount remaining after you deduct the capital losses made this year.
Deduct both types of losses in the manner that gives you the greatest benefit. You will probably get the greatest benefit if you deduct capital losses from capital gains in the following order:. You can only use capital losses from collectables this year and unapplied net capital losses from collectables from earlier years to reduce capital gains from collectables. Jewellery, art and antiques are examples of collectables.
Losses from personal use assets are disregarded. Personal use assets are assets mainly used for personal use that are not collectables, such as a boat you use for recreation. See the Guide to capital gains tax for more information. If the total of your capital losses for the year and unapplied net capital losses from earlier years is greater than your capital gains, go to step The amount now remaining is your net capital gain cents are not shown.
Write this amount at A item 18 on your tax return supplementary section. At V item 18 write the amount by which the total of your capital losses for the year and unapplied net capital losses from earlier years is greater than your capital gains for the year. You carry this amount forward to be applied against later year capital gains. He would leave blank both A and H item 18 on his tax return supplementary section. The following examples show how CGT works in various situations where people have bought and sold shares and units.
They may help you meet your CGT obligations and complete item 18 on your tax return supplementary section. The sale is a CGT event. She cannot use the indexation or discount method. Her capital gain is:. As she has no other CGT event and does not have any capital losses, Sonya completes item 18 on her tax return supplementary section as follows:. Andrew has a capital gain from the sale of units which he bought before The gift is a CGT event. If Andrew calculates his capital gain or capital loss using the indexation method, he indexes the cost of his units and the incidental costs of buying them as follows:.
If he did, he would deduct any capital losses before applying the CGT discount. As he has no other CGT event and does not have any capital losses, Andrew completes item 18 on his tax return supplementary section as follows:. If Andrew had received a non-assessable payment from the fund, his cost base may have been reduced and the capital gain may have been greater. For more information, see chapter C2. Fatima has a capital gain from one parcel of shares which she was given before If she did, she would deduct any capital losses before applying the CGT discount.
As she has no other CGT event and does not have any capital losses, Fatima completes item 18 on her tax return supplementary section as follows:. Colin has a capital gain from some units he bought after The redeeming of units is a CGT event. As he had no other CGT event during —13 and does not have any capital losses, Colin completes item 18 on his tax return supplementary section as follows:.
If Colin had received a non-assessable payment from the fund, his cost base may have been adjusted and the capital gain may have been greater. Mei-Ling made a capital gain from some shares she bought after She also has a net capital loss from an earlier income year. As she has no other CGT event, Mei-Ling completes item 18 on her tax return supplementary section as follows:. Mario made a capital loss from one parcel of shares he bought before Mario purchased the Machinery Manufacturers Ltd shares before The net capital losses that Mario can carry forward to reduce capital gains he may make in later income years are:.
As he has no other capital gains or capital losses, Mario does not write anything at A and completes item 18 on his tax return supplementary section as follows:. Clare made capital gains from shares she bought before There were no brokerage costs on sale. Clare firstly works out her net capital gain by applying both the indexation method and the discount method to the whole parcel of shares:. However, because each share is a separate asset, Clare can use different methods to work out her capital gains for shares within the parcel. The lowest net capital gain would result from her applying the indexation method to sufficient shares to absorb the capital loss or as much of the capital loss as she can and apply the discount method to any remaining shares.
This chapter briefly explains less common situations for personal investors, including those arising from:. If you hold shares or units, you may be issued rights or options to acquire additional shares or units at a specified price. You are taken to have acquired the rights or options at the same time you acquired the original shares or units. You make a capital loss if the reduced cost base of the rights or options is more than those capital proceeds.
There are special rules that apply if you exercise the rights or options. For more information, or if you acquire rights or options under an employee share scheme, see the Guide to capital gains tax Doing so means the gains you made on your successful investments can be offset against the losses from the less successful ones, reducing your overall taxable income. Keep in mind that for CGT purposes a capital gain generally occurs on the date you sign a contract, not when you settle on a property purchased. When you are making a large capital gain toward the end of an income year, knowing which financial year the gain will be attributed to is a great tax planning advantage.
If you can get a quick appointment, why not have a possibly expensive medical procedure completed before June 30 and have more to put towards qualifying for the Medical Expenses Offset? The offset is means tested, but if you qualify many medical expenses are included, as well as some nursing home or hostel costs but sorry, no nips or tucks. In the latest federal budget the government has proposed that this measure will be phased out, possibly from as early as July , depending upon circumstances.
Bear this in mind if you are considering medical and dental procedures. Nobody knows your affairs better than yourself, so you will recognise if any of the above tax tips applies to your circumstances. Every individual taxpayer is required to lodge their return before October 31, but tax professionals are generally given more time to lodge, which can be a handy extension to a payment deadline. In these cases, it is worth getting all your information to this office as soon as you can after July 1. This post was last modified: Apr 10, 3: Information provided on this site is for general guidance only.