Show download pdf controls
  • Calculating a capital gain or capital loss for a depreciating asset that is not a pooled asset


    This information may not apply to the current year. Check the content carefully to ensure it is applicable to your circumstances.

    End of attention

    You make a capital gain if a depreciating asset's termination value is more than its cost. A capital gain from a depreciating asset is calculated as follows:

    (Termination value − cost) × (sum of reductions ÷ total decline)

    Sum of reductions is the sum of the reductions in your deductions for the asset's decline in value that is attributable to your use of the asset, or your having it installed ready for use, for a non-taxable purpose. Total decline is the decline in value of the depreciating asset since you started to hold it.

    You make a capital loss if the depreciating asset's cost is more than its termination value. A capital loss from a depreciating asset is calculated as follows:

    Cost − termination value) × (sum of reductions ÷ total decline)


    Larry purchased a truck in August 2001 for $5,000. He used the truck 90 per cent for business purposes. The decline in value of the truck up to the date of sale was $2,000. Larry disposes of the truck in July 2004 for $7,000. Larry calculates his capital gain from CGT event K7 as follows:

    ($7,000 − $5,000) × (200 ÷ 2,000)

    Capital gain from CGT event K7 = $200

    End of example
    Last modified: 06 Oct 2009QC 27417