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  • How do I treat the capital gain or capital loss?

    Capital gain

    If you made a capital gain on the disposal of your Westfield America units, you must include it in your calculations when completing item 17 on your 2004-05 tax return (supplementary section).

    The method you use to work out the amount to include in your item 17 calculations depends on when you acquired those units. The following table sets out what method you can use.

    If you acquired your Westfield America Trust units:

    You calculate your capital gain using the:

    before 21 September 1999

    Indexed cost base or discount method *

    Note: if you have capital losses to apply against capital gains you made on shares acquired before 21 September 1999, you may want to use the indexation method for some of your shares and the discount method for the others. (For more information, see example of Clare in chapter 2 of the Guide to capital gains tax 2004-05)*

    on or after 21 September 1999 and before 2 July 2003

    Discount method

    Note: If you have capital losses to apply against capital gains you made on these shares, you deduct the capital losses before applying the discount

    on or after 2 July 2003

    'Other' method

    * If you choose to index the cost base of units you acquired before 21 September 1999, you cannot apply the CGT discount when you dispose of them.

    For information on the different methods you can use to work out your capital gain, see the Guide to capital gains tax 2004-05.

    Capital loss

    If you made a capital loss, you can offset this loss against other capital gains you made in the 2004-05 income year. If you are unable to offset all the capital loss, you can carry the balance forward to offset against future capital gains. You must include these details when completing item 17 on your 2004-05 tax return (supplementary section).

    How do I work out the cost bases of the elements of the stapled securities that I received?

    Each Westfield stapled security is made up of:

    • one Westfield Holdings Limited (WSF) share
    • one Westfield Trust (WFT) unit, and
    • one Westfield America Trust (WFA) unit.

    For CGT purposes, each element of the stapled security is a separate CGT asset. The initial cost base (and reduced cost base) of each element is a reasonable part of the value of the Westfield America Trust units exchanged for the stapled securities. The following table gives the initial cost base of each element (worked out based on the net tangible assets attached to each element).


    Initial cost base (reduced cost base)


    WSF share


    $15.48 x 9.09%

    WFT unit


    $15.48 x 52.39%

    WFA unit


    $15.48 x 38.52%

    Example -sale facility receiving stapled securities

    Mario acquired 1,000 units in WFA in July 2000. Immediately before the sale arrangement commenced, the cost base of his units was $1,740 (or $1.74 per unit). Mario's units were consolidated as the first step of the sale arrangement. After consolidation, he held 150 (1,000 x 0.15) units with a cost base of $1,740 (or $11.60 per unit).

    Mario chose to exchange his WFA units for Westfield Group stapled securities. He received 150 Westfield Group stapled securities in exchange for his WFA units. The Commissioner will accept that Mario's capital proceeds for the exchange of his units are equal to the volume weighted average price of the Westfield Group stapled securities over the first five trading days. Westfield has advised that this was $15.48.

    Calculating the net capital gain

    Mario makes a capital gain on the disposal of 150 units as follows:

    Capital proceeds (150 x $15.48)


    less total cost base


    Capital gain


    Because Mario had held his units for more than 12 months, he applies the CGT discount to his capital gain (if he had capital losses he would offset them against his capital gain before applying the discount). Mario will include a $291 ($582 x 50%) net capital gain on his tax return for the year ended 30 June 2005.

    Recording the capital gain on the tax return

    Assuming he had no other capital gains and no capital losses for the 2004-05 year, Mario would complete item 17 on his 2005 tax return (supplementary section) showing:

    Did you have a capital gains tax event during the year? Yes

    Net capital gain: $291

    Total current year capital gains: $582

    Working out new cost bases

    Mario will calculate the cost base and reduced cost base of his WSF units, WFT and WFA units as follows:

    WSF units ($1.41 x 150) = $211.50

    WFT units ($8.11 x 150) = $1,216.50

    WFA units ($5.96 x 150) = $894.00

      Last modified: 06 Oct 2009QC 18186