Find out what can trigger a CGT event, such as selling shares or receiving certain distributions.
Selling your shares or units is the most common CGT event, but there are others.
A CGT event may occur if you:
- redeem units in a managed fund by switching them from one fund to another
- make an in specie transfer
- accept an offer from a company to buy back your shares
- receive a distribution (other than a dividend) from a unit trust or managed fund
- receive non-assessable payments from a company
- own shares in a company that is taken over by or merges with another company
- own shares in a company that is placed in liquidation or administration and the shares (or other financial instruments) are declared worthless by the liquidator or administrator.
If you sell shares or have another CGT event, you need to calculate your CGT and report it in your income tax return.
When a corporate group restructures, we often publish a class ruling or fact sheet setting out the tax consequences for shareholders.
For a video showing how to enter your capital gains and losses in myTax when you dispose of shares, see Disposing of shares.
CGT does not apply to:
- dividends you receive from your investments – these are taxed as ordinary income
- profits on the sale of shares if you are carrying on a business of share trading – these are taxed as ordinary business income rather than capital gains.