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  • Capital gains

    Not all assets attract capital gains tax. As a small business operator, you most commonly make a capital gain or capital loss when you sell one of the assets you use in your business, for example, your business premises or goodwill. If you conduct your business through a company or trust, you may make a capital gain or capital loss if you sell your shares in the company or interest in the trust.

    Capital gains tax does not generally apply to depreciating assets you use only in your business, for example, tools or motor vehicles. Gains from these assets are included in your income and you can claim a deduction for your losses.

    Capital gains tax affects the amount of income tax you are liable to pay because you must include any net capital gain you made in your assessable income.

    Your net capital gain is the total of your capital gains for the year, less any capital losses for the year or earlier years, and any relevant concessions.

    Tax concessions for small business can reduce the tax you must pay on capital gains.


    You must keep records of any act, transaction, event or circumstance that might reasonably be expected to be relevant to working out a capital gain or capital loss. You must do this even if the capital gain or capital loss hasn't yet happened.

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    • Last modified: 01 Jun 2013QC 31765