Guide to capital gains tax 2005-06

Step 7 - Applying the CGT discount

You can now reduce any remaining current year capital gains calculated using the discount method by the discount percentage (50% for individuals).

You cannot apply the discount to capital gains calculated using the indexation method or the 'other' method.

Example: Total capital gains calculated using the discount method

From our earlier example, we know Kathleen had capital gains of $2,520 calculated using the discount method after applying relevant capital losses. She works out her total capital gains by multiplying her capital gain by the CGT discount of 50%:

$2,520 x 50% = $1,260

Sections within Part B - Completing the capital gains section of your tax return

• Read this first
• Introduction
• Step 1 - Types of CGT assets and CGT events
• Step 2 - Calculating your current year capital gain or capital loss for each CGT asset or CGT event
• Step 3 - Total current year capital gains
• Step 4 - Capital losses
• Step 5 - Applying current year capital losses
• Step 6 - Applying net capital losses from earlier years
• Step 7 - Applying the CGT discount
• Step 8 - Applying the small business CGT concessions
• Step 9 - Working out your net capital gain
• Step 10 - Capital losses carried forward to later income years