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Flowchart 1
Treatment of bonus shares issued on or after 20 September 1985.
1. Did you acquire the original shares on or after 20 September 1985?
Yes |
Read on from question 2. |
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No |
Read on from question 4. |
2. Is any part of the bonus shares a dividend or treated as a dividend?
Yes |
Read on from question 3. |
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No |
Read answer 1. |
3. Were the bonus shares issued before 1 July 1987?
Yes |
Read answer 1. |
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No |
Read answer 3. |
4. Is any part of the bonus shares a dividend or treated as a dividend?
Yes |
Read on from question 5. |
---|---|
No |
Read on from question 6. |
5. Were the bonus shares issued before 1 July 1987?
Yes |
Read on from question 6. |
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No |
Read answer 2. |
6. Are the bonus shares partly paid?
Yes |
Read on from question 7. |
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No |
Read answer 4. |
7. Were the bonus shares issued before 10 December 1986?
Yes |
Read answer 4. |
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No |
Read on from question 8. |
8. Before sale of the bonus shares, were any more call payments made to the company?
Yes |
Read answer 5. |
---|---|
No |
Read answer 4. |
Answer 1
- The bonus shares are subject to capital gains tax.
- The bonus shares are acquired when the original shares were acquired.
- The cost base of each original and bonus share is equal to:
- the cost base of the original shares divided by the total number of original and bonus shares, plus
- any calls on partly paid bonus shares.
Answer 2
- The bonus shares are subject to capital gains tax if issued on or after 20 September 1985.
- The acquisition date of the bonus shares is their date of issue.
- The cost base is the amount of the dividend plus any calls on partly paid bonus shares.
Answer 3
- The bonus shares are subject to capital gains tax.
- The acquisition date of the bonus shares is their date of issue.
- The cost base is the amount of the dividend, plus any calls on partly paid bonus shares.
Answer 4
You are taken to have acquired the bonus shares before 20 September 1985 and they are not subject to capital gains tax.
Answer 5
- The bonus shares are subject to capital gains tax.
- The acquisition date of the bonus shares is the date when the liability to pay the first call arises.
- The cost base is the market value of the bonus shares just before the liability to pay the first call arises, plus the amount of call payments made.