Introduction to capital gains tax

CGT events affecting shares and units

You may have to pay tax on any capital gain you make on shares or units when a CGT event happens, such as when you sell them (unless you acquired them before CGT came in on 20 September 1985).

For more information about shares and capital gains tax, refer to Personal investors guide to capital gains tax.

A CGT event also occurs when you redeem units in a managed fund by switching them from one fund to another.

For more information about distributions from a unit trust or managed fund, refer to Capital gains made by trusts.

A CGT event can happen to shares even if a change in their ownership is involuntary - for example, if the company in which you hold shares is taken over by or merges with another company. This may result in a capital gain or capital loss for you.

A CGT event occurs if you receive non-assessable payments from a company or trust, or own shares in a company that has been placed in liquidation or administration and the liquidator or administrator has declared the shares (or other financial instruments) worthless.

For more information, refer to: Non-assessable payments Non-assessable capital payments from a trust Shares in a company in liquidation or administration.

Special CGT rules apply if you:

• receive, from a company or trust, bonus shares, bonus units, or rights or options to acquire shares or units
• buy convertible notes or participate in an employee share scheme or a dividend reinvestment plan.

For more information, refer to: Bonus shares Bonus units Rights or options to acquire shares or units Convertible notes An introduction to employee share schemes.

Corporate restructures We may publish a class ruling or fact sheet on our website detailing the tax consequences of a company action: these are listed under Events affecting shareholders. Listed investment companies Since 1 July 2001, you may be entitled to an income tax deduction if a listed investment company (LIC) pays you a dividend that includes an LIC capital gain amount. If you have received such an amount, read You and your shares.

Capital gains tax - home

Sections within Shares and units

• CGT events affecting shares and units
• Records relating to shares and units