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Edited version of your written advice
Authorisation Number: 1012782163700
Ruling
Subject: Capital losses
Question
Did you make a capital loss in the 2014-15 financial year?
Answer
No, however a capital loss would have occurred in the relevant financial year.
This ruling applies for the following period
Year ended 30 June 2015
The scheme commences on:
1 July 2014
Relevant facts and circumstances
You have an investment which was purchased after 1985.
You hold the units as a capital investment.
The entity is currently in liquidation.
The liquidators made a written declaration in the relevant financial year that the investment has no value.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 104-145
Reasons for decision
A capital loss or capital gain is made when a capital gains tax (CGT) event happens to a CGT asset.
CGT event G3 occurs if a liquidator or administrator declares shares or financial instruments worthless. The time of the CGT event is when the declaration is made.
In this case, the liquidators made a declaration in the relevant financial year that the investments had become worthless. Therefore, the capital loss would have occurred in the relevant financial year rather than the 2014-15 financial year.