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Capital Gains/Losses Definitions

Indexation Method

For CGT assets acquired before 11.45 a.m. by legal time in the ACT on 21 September 1999, the indexation of the cost base of an asset is frozen as at 30 September 1999. Individuals, trusts and superannuation entities, can choose to use either the cost base indexed, frozen as at 30 September 1999, or the CGT discount.

Discount Method

If a CGT event occurs in relation to a CGT asset after 11.45 a.m. by legal time in the ACT on 21 September 1999 and the asset was acquired at least 12 months before the CGT event, you may be entitled to discount the capital gain after applying capital losses. The discount percentage for an individual or trust is 50% and for a complying superannuation entity is 33 1/3%. Companies (other than those life insurance companies and friendly societies which carry on life insurance business that are entitled to the CGT discount in respect of their complying superannuation business) are not eligible for the CGT discount.

Current year capital losses and then prior year net capital losses are applied against current year capital gains before applying the CGT discount. If any capital gains qualify for the CGT small business concessions, those concessions are then applied to each capital gain.

For CGT assets acquired before 11.45 a.m. by legal time in the ACT on 21 September 1999, you have the option of choosing the CGT discount or calculating the capital gain using indexation frozen as at 30 September 1999. Calculate your capital gain under each option to determine the best result in your particular circumstances.

Other Method

This method applies if both the Indexation method and the Discount method do not apply, that is if:

  • the asset was owned for less than 12 months,

  • there was a current year capital loss

  • there was a prior year capital loss, or

  • there was nil capital gain.

Captial gains tax reports

There are two capital gains tax reports:

Report nameDescription

Capital gains report

The capital gains report provides a detailed report of all CGT events in the order in which the transactions were entered.

Capital gains summary reportThe Capital gains summary report provides a summary of all asset transactions by asset category, together with all discounts and exemptions and capital losses applied.