Does capital gains tax apply to you?
These 4 episodes provide general background information about CGT and whether, and how, it applies to you.
How to work out your capital gain or capital loss.
These 4 episodes explain how to work out each capital gain or capital loss you made during the income year.
They do not explain how to work out your net capital gain or net capital losses carried forward to later income years. If you are completing the Tax return for individuals 2009 and want more information on how to calculate your net capital gain for the income year or net capital losses carried forward to later income years (including how to deduct any unapplied net capital losses from earlier years), Contact Taxwise on 9248 8124. For more information about companies, trusts and funds or about completing the CGT summary worksheet, Contact Taxwise on 9248 8124.
Keeping records.
You must keep records of everything that affects your capital gains and capital losses. Penalties can apply if you do not keep the records for at least five years after the relevant CGT event.
Keeping adequate records of all expenditure will help you correctly work out the amount of capital gain or capital loss you have made when a CGT event happens. It will also help to make sure you do not pay more CGT than is necessary. If you have applied a net capital loss, you should generally keep your records of the CGT event that resulted in the loss for four years from the income year when the net capital loss is fully applied.
Keeping good records can help your beneficiaries reduce the impact of CGT after you die. If you leave an asset to another person, the asset may be subject to CGT when a CGT event happens to that asset in the future – for example, if your daughter (the beneficiary) sells the shares (the asset) you have left her in your will.
Tomorrow’s Episode……. Trust distributions and Investments in shares and units.
About the Author
Warren Kruger is an Australian Tax Specialist and Advisor.
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Warren Kruger is an Australian Tax Specialist and Advisor. For a FREE Report “7 Essential Strategies to Reduce Your Taxation NOW!”,enter your name and email address in the Opt In Box located on the top right hand side of this article.