What CGT records do you need to keep?
This information may not apply to the current year. Check the content carefully to ensure it is applicable to your circumstances.
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You must keep records of everything that may be relevant to working out whether you have made a capital gain or capital loss from a CGT event of an asset.
This means you need records to substantiate the purchase and disposal of any asset, as well as other costs relating to the asset. Records can include contracts, valuations, and details of commissions and legal fees you paid. Penalties can apply if you do not keep the records for at least five years after the relevant CGT event. If you use information from those records in a later tax return, you may have to keep records for longer. If you have applied a net capital loss, you should generally keep your records of the CGT event that resulted in the loss until the end of any period of review for the income year in which the net capital loss is fully applied.
The records must:
- show the nature of the act, transaction, event or circumstance, and the date it happened
- be in English, or in a form that can be readily translated into English.
If you do not keep proper CGT records you might have to pay:
- extra expenses to establish the cost of an asset when you dispose of it
- more tax than necessary.
CGT asset register
You might find that a simpler way to keep records of assets is to keep a CGT asset register. This is a register of information about your CGT assets that you have transferred from your CGT records (for example, invoices, receipts and contracts).
For most assets this information includes:
- the date you acquired the asset
- the cost of the asset
- a description, amount and date for each cost associated with purchasing the asset (for example, stamp duty and legal fees)
- the date the asset was disposed of
- the amount you received when you disposed of the asset
- any other information relevant to working out your CGT obligation.
You can discard your CGT records five years after having an asset register entry certified if you meet all of the following:
- you enter all the necessary information about an asset in your CGT asset register
- the entry is in English and is certified in writing by an approved person (for example, a registered tax agent)
- the asset register entry is certified after 31 December 1997 (although you may have acquired the asset before this date).
If you do not keep an asset register, you generally have to keep CGT records for at least five years after you dispose of an asset. For example, if you hold an asset for 10 years and then sell it, you would have to keep the records for 15 years.
Example: CGT asset register
Max bought a business property on 1 January 2000.
His tax agent advised him to transfer the relevant CGT information from his records to an asset register, namely, the:
- date he purchased the property
- purchase price
- stamp duty.
Max did this and his agent certified the register on 1 July 2000.
Max sold the property on 15 September 2005.
Because Max had recorded the details of the property on an asset register, he had to keep records relating to the property only until 1 July 2005, rather than 15 September 2010.
End of example