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Edited version of your private ruling
Authorisation Number: 1012581639494
Ruling
Subject: CGT losses
Question
Did you make a capital loss on your shares when the company was deregistered?
Yes.
This ruling applies for the following period
Year ended 30 June 2010
The scheme commenced on
21 August 2006
Relevant facts
You purchased shares.
The shares have been deregistered.
Relevant legislative provisions
Income Tax Assessment Act 1997 Section 102-5.
Income Tax Assessment Act 1997 Section 102-10.
Income Tax Assessment Act 1997 Section 102-15.
Income Tax Assessment Act 1997 Section 102-20.
Income Tax Assessment Act 1997 Paragraph 104-25(1)(a).
Income Tax Assessment Act 1997 Paragraph 104-25(2)(b).
Income Tax Assessment Act 1997 Subsection 104-25(3).
Income Tax Assessment Act 1997 Paragraph 104-145(1)(a).
Income Tax Assessment Act 1997 Subsection 104-145(2).
Income Tax Assessment Act 1997 Subsection 104-145(4).
Reasons for decision
You can make a capital loss when a company is deregistered in accordance with Corporations Law as your ownership of that company's shares ends at that time due to them being cancelled.
In your case, you have made a capital loss when the companies were deregistered.
Generally you make a capital loss if your reduced cost base is greater than your capital proceeds. The excess is your capital loss.
Your capital loss can be calculated as follows:
Reduced cost base = Purchase price + Incidental costs of acquiring shares
Capital loss = Reduced cost base Capital proceeds (Nil)