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Edited version of private advice
Authorisation Number: 1052177044372
Date of advice: 17 January 2024
Ruling
Subject: High yield investment scheme - capital loss
Question 1
Did you acquire a CGT asset (as defined in section 108-5 of the Income Tax Assessment Act 1997 (ITAA 1997)) as a result of entering into a high yield investment scheme?
Answer
Yes. You acquired a CGT asset being a contractual right at the time of entering the arrangement.
Question 2
Did a CGT event subsequently happen to that contractual right?
Answer
Yes. CGT event C1 happened in respect of the contractual right when the contractual right came to an end. Section 104-20 of the ITAA 1997 outlines the rules for CGT event C1.
This private ruling applies for the following period:
1 July 20XX to 30 June 20XX
The scheme commenced on:
1 January 2020
Relevant facts and circumstances
You invested your funds into various share trading platforms.
Later, you discovered that the share trading platforms were not legitimate or genuine. You expected to make a profit from the arrangement based on the representations made by the other parties to the arrangement. You later found that the investment was not genuine.
Relevant legislative provisions
Section 102-5 Income Tax Assessment Act 1997
Section 104-20 Income Tax Assessment Act 1997
Section 108-5 Income Tax Assessment Act 1997