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  • Appendixes

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    In this section:

    Appendix 1 Summary of CGT events

    Disposal

    Disposal

    CGT event

    Time of event

    Capital gain

    Capital loss

    A1 Disposal of a CGT asset

    When the disposal contract is entered into
    or, if none,
    when the entity stops being the asset’s owner

    The capital proceeds from disposal
    less
    the asset’s cost base

    The asset’s reduced cost base
    less
    capital proceeds

    Hire purchase and similar agreements

    Hire purchase and similar agreements

    CGT event

    Time of event

    Capital gain

    Capital loss

    B1 Use and enjoyment before title passes

    When use of the CGT asset passes

    The capital proceeds
    less
    the asset’s cost base

    The asset’s reduced cost base
    less
    capital proceeds

    End of a CGT asset

    End of a CGT asset

    CGT event

    Time of event

    Capital gain

    Capital loss

    C1 Loss or destruction of
    a CGT asset

    When compensation is first received
    or, if none,
    when the loss is discovered or destruction occurred

    The capital proceeds
    less
    the asset’s cost base

    The asset’s reduced cost base
    less
    capital proceeds

    C2 Cancellation, surrender and similar endings

    When the contract ending an asset is entered into
    or, if none,
    when an asset ends

    The capital proceeds from the ending
    less
    the asset’s cost base

    The asset’s reduced cost base
    less
    capital proceeds

    C3 End of an option to acquire shares and so on

    When the option ends

    The capital proceeds from granting the option
    less
    expenditure in granting it

    The expenditure in granting the option
    less
    capital proceeds

    Bringing a CGT asset into existence

    Bringing a CGT asset into existence

    CGT event

    Time of event

    Capital gain

    Capital loss

    D1 Creating contractual or other rights

    When the contract is entered into
    or
    the right is created

    The capital proceeds from creating the right
    less
    incidental costs of creating the right

    The incidental costs of creating the right
    less
    capital proceeds

    D2 Granting an option

    When the option is granted

    The capital proceeds from the grant
    less
    expenditure to grant it

    The expenditure to grant the option
    less
    capital proceeds

    D3 Granting a right to income from mining

    When the contract is entered into
    or, if none,
    when the right is granted

    The capital proceeds from the grant of right
    less
    the expenditure to grant it

    The expenditure to grant the right
    less
    capital proceeds

    D4 Entering into a conservation covenant

    When covenant is entered into

    The capital proceeds from covenant
    less
    cost base apportioned to the covenant

    The reduced cost base apportioned to the covenant less
    capital proceeds from covenant

    Trusts

    Trusts

    CGT event

    Time of event

    Capital gain

    Capital loss

    E1 Creating a trust over a CGT asset

    When the trust is created

    Capital proceeds from creating the trust
    less
    the asset’s cost base

    The asset’s reduced cost base
    less
    capital proceeds

    E2 Transferring a CGT asset to a trust

    When the asset is transferred

    Capital proceeds from the transfer
    less
    the asset’s cost base

    The asset’s reduced cost base
    less
    capital proceeds

    E3 Converting a trust to a unit trust

    When the trust is converted

    Market value of the asset at that time
    less
    its cost base

    The asset’s reduced cost base
    less
    that market value

    E4 Capital payment for trust interest

    When the trustee makes the payment

    Non-assessable part of the payment less
    the cost base of the trust interest

    No capital loss

    E5 Beneficiary becoming entitled to a trust asset

    When the beneficiary becomes absolutely entitled

    For a trustee, market value of the CGT asset at that time
    less
    its cost base

    For a beneficiary, that market value
    less
    the cost base of the beneficiary’s capital interest

    For a trustee,
    the reduced cost base of the CGT asset at that time
    less
    that market value

    For a beneficiary,
    the reduced cost base of the beneficiary’s capital interest
    less
    that market value

    E6 Disposal to a beneficiary to end an income right

    The time of the disposal

    For a trustee, market value of the CGT asset at that time
    less
    its cost base

    For a beneficiary, that market value
    less
    the cost base of the beneficiary’s right to income

    For a trustee,
    the reduced cost base of the CGT asset at that time
    less
    that market value

    For a beneficiary,
    the reduced cost base of the beneficiary’s right to income
    less
    that market value

    E7 Disposal to a beneficiary to end capital interest

    The time of the disposal

    For a trustee,
    market value of the CGT asset at that time
    less
    its cost base

    For a beneficiary, that market value
    less
    the cost base of the beneficiary’s capital interest

    For a trustee,
    the reduced cost base of the CGT asset at that time
    less
    that market value

    For a beneficiary,
    the reduced cost base of the beneficiary’s capital interest
    less
    that market value

    E8 Disposal by a beneficiary of capital interest

    When the disposal contract is entered into or, if none,
    when the beneficiary ceases to own the CGT asset

    Capital proceeds
    less
    the appropriate proportion of the trust’s net assets

    The appropriate proportion of the trust’s net assets
    less
    the capital proceeds

    E9 Creating a trust over future property

    When the entity makes an agreement

    Market value of the property (as if it existed when the agreement was made)
    less
    incidental costs in making the agreement

    The incidental costs in making the agreement
    less
    the market value of the property (as if it existed when the agreement was made)

    E10 Annual cost base reduction exceeds cost base of interest in AMIT

    When reduction happens

    Excess of cost base reduction over cost base

    No capital loss

    Leases

    Leases

    CGT event

    Time of event

    Capital gain

    Capital loss

    F1 Granting a lease

    For granting a lease, when the entity enters into the lease contract or, if none, at the start of the lease

    For a lease renewal or extension, at the start of the renewal or extension

    Capital proceeds
    less
    the expenditure on grant, renewal or extension

    Expenditure on grant, renewal or extension
    less
    capital proceeds

    F2 Granting a long-term lease

    For granting a lease, when the lessor grants the lease

    For a lease renewal or extension, at the start of the renewal or extension

    Capital proceeds from the grant, renewal or extension
    less
    the cost base of the leased property

    Reduced cost base of the leased property
    less
    the capital proceeds from the grant, renewal or extension

    F3 Lessor pays lessee to get lease changed

    When the lease term is varied or waived

    No capital gain

    Amount of expenditure to get lessee’s agreement

    F4 Lessee receives payment for changing a lease

    When the lease term is varied or waived

    Capital proceeds
    less
    the cost base of lease

    No capital loss

    F5 Lessor receives payment for changing a lease

    When the lease term is varied or waived

    Capital proceeds less
    expenditure for variation or waiver

    Expenditure for variation or waiver
    less
    capital proceeds

    Shares

    Shares

    CGT event

    Time of event

    Capital gain

    Capital loss

    G1 Capital payment for shares

    When the company pays a non-assessable amount

    Payment
    less
    cost base of shares

    No capital loss

    G3 Liquidator or administrator declares shares or financial instruments worthless

    When declaration is made

    No capital gain

    Reduced cost base of shares
    or financial instruments

    Special capital receipts

    Special capital receipts

    CGT event

    Time of event

    Capital gain

    Capital loss

    H1 Forfeiture of a deposit

    When the deposit is forfeited

    Deposit
    less
    expenditure in connection with the prospective sale

    Expenditure in Connection with the prospective sale
    less
    deposit

    H2 Receipt for an event relating to a CGT asset

    When the act, transaction or event occurred

    Capital proceeds
    less
    incidental costs

    Incidental costs
    less
    capital proceeds

    Cessation of residency

    Cessation of residency

    CGT event

    Time of event

    Capital gain

    Capital loss

    I1 Individual or company stops being an Australian resident

    When the individual or company stops being an Australian resident

    For each CGT asset the person owns, its market value
    less
    its cost base

    For each CGT asset the person owns, its reduced cost base
    less
    its market value

    I2 Trust stops being a resident trust

    When the trust ceases to be a resident trust for CGT purposes

    For each CGT asset the trustee owns, its market value
    less
    its cost base

    For each CGT asset the trustee owns, its reduced cost base
    less
    its market value

    Reversal of rollover

    Reversal of rollover

    CGT event

    Time of event

    Capital gain

    Capital loss

    J1 Company stops being a member of a wholly owned group after a rollover

    When the company stops being a member of a wholly owned group after a rollover

    Market value of the asset at the time of the event
    less
    its cost base

    Reduced cost base of the asset less that market value

    J2 Change for replacement asset or improved asset after a rollover under Subdivision 152-E

    when the change happens

    The amount mentioned in subsection
    104-185(5)

    No capital loss

    J4 Trust failing to cease to exist after rollover under Subdivision 124-N

    when the failure to cease to exist happens

    For a company, market value of the asset at the time the company acquired it
    less
    its cost base at that time

    For a shareholder, market value of the share at the time the shareholder acquired it
    less
    its cost base at that time

    For a company, reduced cost base of the asset at the time the company acquired it
    less
    its market value at that time

    For a shareholder, reduced cost base of the share at the time the shareholder acquired it
    less
    its market value at that time

    J5 Failure to acquire replacement asset and to incur fourth element expenditure after a rollover under Subdivision 152-E

    At the end of the replacement asset period

    The amount of the capital gain that you disregarded under Subdivision
    152-E

    No capital loss

    J6 Cost of acquisition of replacement asset or amount of fourth element expenditure, or both, not sufficient to cover disregarded capital gain

    At the end of the replacement asset period

    The amount mentioned in subsection
    104-198(3)

    No capital loss

    Other CGT events

    Other CGT events

    CGT event

    Time of event

    Capital gain

    Capital loss

    K2 Bankrupt pays an amount for debt

    When payment is made

    No capital gain

    That part of the payment that relates to the denied part of a net capital loss

    K3 Asset passing to a tax-advantaged entity

    When an individual dies

    Market value of the asset at death
    less
    its cost base

    Reduced cost base of the asset
    less
    that market value

    K4 CGT asset starts being trading stock

    When the asset starts being trading stock

    Market value of asset
    less
    its cost base

    Reduced cost base of the asset
    less
    that market value

    K5 Special capital loss from a collectable that has fallen in market value

    When CGT event A1, C2 or E8 happens to shares in the company, or an interest in the trust, that owns the collectable

    No capital gain

    Market value of the shares or interest (as if the collectable had not fallen in market value)
    less
    the capital proceeds from CGT event A1, C2 or E8

    K6 Pre-CGT shares or trust interest

    When another CGT event involving the shares or interest happens

    Capital proceeds from the shares or trust interest that are attributable to post-CGT assets owned by the company or trust
    less
    the assets’ cost bases

    No capital loss

    K7 Balancing adjustment occurs for a depreciating asset that you used for purposes other than taxable purposes

    When the balancing adjustment event occurs

    Termination value
    less
    cost times fraction

    Cost
    less
    termination value times fraction

    K8 Direct value shifts affecting your equity or loan interests in a company or trust

    The decrease time for the interests

    Capital gain worked out under section 725-365

    No capital loss

    K9 Entitlement to receive payment of a carried interest

    When you become entitled to receive the payment

    Capital proceeds from the entitlement

    No capital loss

    K10 You make a forex realisation gain as a result of forex realisation event 2 and item 1 of the table in subsection 775-70(1) applies

    When the forex realisation event happens

    Equal to the forex realisation gain

    No capital loss

    K11 You make a forex realisation loss as a result of forex realisation event 2, and item 1 of the table in subsection 775-75(1) applies

    When the forex realisation event happens

    No capital gain

    Equal to the forex realisation loss

    K12 Foreign hybrid loss exposure adjustment

    Just before the end of the income year

    No capital gain

    The amount stated in subsection
    104-270(3)

    Consolidations

    Consolidations

    CGT event

    Time of event

    Capital gain

    Capital loss

    L1 Reduction under section 705-57 in tax cost setting amount of assets of entity becoming subsidiary member of consolidated group or MEC group

    Just after entity becomes subsidiary member

    No capital gain

    Amount of reduction

    L2 Amount remaining after step 3A etc of ‘joining allocable cost amount' is negative

    Just after entity becomes subsidiary member

    Amount remaining

    No capital loss

    L3 Tax cost setting amounts for retained cost base assets exceed joining allocable cost amount

    Just after entity becomes subsidiary member

    Amount of excess

    No capital loss

    L4 No reset cost base assets against which to apply excess of net allocable cost amount on joining

    Just after entity becomes subsidiary member

    No capital gain

    Amount of excess

    L5 Amount remaining after step 4 of ‘leaving allocable cost amount' is negative

    When entity ceases to be subsidiary member

    Amount remaining

    No capital loss

    L6 Error in calculation of tax cost setting amount for joining entity’s assets

    Start of the income year when the Commissioner becomes aware of the errors

    The net overstated amount resulting from the errors, or
    a portion of that amount

    The net understated amount resulting from the errors, or
    a portion of that amount

    L8 Reduction in tax cost setting amount for reset cost base assets on joining cannot be allocated

    Just after entity becomes subsidiary member

    No capital gain

    Amount of reduction that cannot be allocated

    Last modified: 22 Jun 2018QC 55220