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  • Step 4-If you did not make a capital gain, work out the reduced cost base of the asset

    Attention

    Warning:

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

    End of attention

    If you did not make a capital gain, you need to calculate a reduced cost base of your asset before you can work out any capital loss.

    The reduced cost base is the cost base less any amounts you need to deduct from the cost base. Interest on borrowings and indexation are not included.

    Example

    In our example, Fred's cost base and reduced cost base for his shares are the same.

    Note: Reduced cost base

    For shares, generally the cost base and reduced cost base will be the same.

    For units, the cost base and reduced cost base will need to be adjusted for tax-deferred amounts and CGT-concession amounts received before 1 July 2001. Only the reduced cost base will need to be further adjusted for a tax-free amount. A tax-exempted amount will not affect the cost base or reduced cost base. The fund should advise you of these amounts in its statements.

    Last modified: 06 Oct 2009QC 16182