CGT is not a different or separate tax. When you have made a Capital Gain (a profit) you will see this amount added to your Taxable Income.
Important to note is that any asset you have purchased or acquired since CGT was first introduced (20 September 1985) will be subject to CGT, with some exceptions for personal-use assets such as the family home or your personal vehicle.
Jill works as a Designer her taxable income is $65, 000. Jill sold shares she held for over 12 months.
Jill can reduce the proceeds by the original purchase price and the cost of brokerage.
Capital Gain is $5,000 - $2,560 = $2,440
Jill will be eligible to receive a discount of 50% therefore her Assessable Capital Gain will be:
$2,440 x 50% = $1,220 this would add to Jill’s Assessable income.
$65, 000 + $1,220 = $66,220 Adjustable Taxable income.
When the sale of an asset has resulted in a Capital Loss than this Loss is to be reported in your Income Tax Return. The Loss will be carried forward each Financial Year until it can be applied to reduce a future Capital Gain.
Come see why thousands of like-minded Queensland investors entrust ITP Qld to best prepare their Capital Gains and Losses and maximise their return, every year. Do you still have questions? Contact an ITP Consultant today.