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26 July 2018

ATO Focus on Shares & Capital Gains

ATO Focus on Shares and Capital Gains 

This year, the ATO has announced it will be focusing on taxpayers who have sold or transferred shares and the amounts reported as capital gains or losses or their tax returns.

As part of its data matching program, the ATO has access to information from share registries, including share disposals, which it then uses to compare to information reported on individuals’ income tax returns.

This can help the ATO with pre-filling information available to download and include in your return, such as dividend income on shares held, which is similar to the data matching used for your bank interest and employment income.

It also means that if the details the ATO has access to are not declared in your tax return, it can trigger a review.

So, if you do sell shares, regardless of whether or not you make a gain or a loss, the sale should be reported on your income tax return.

If the sale has resulted in a capital gain, i.e. the cost price was less than the sale price, the net capital gain will be taxed at your marginal tax rate in the year the gain was made. Generally, if the asset is held for more than 12 months, the net capital gain can be reduced by 50%.

If the sale has resulted in a loss, i.e. the cost price was greater than the sale price, the capital loss can be applied against other capital gains, either in the same year the loss was made, or carried forward to future years until there is a capital gain to apply the loss against.

If you do trade in shares we recommend you keep a record of all cost prices and brokerage fees paid, including dates, on purchase and sale, to be able to calculate any gains or losses made when you dispose of the shares.

Download a share register sheet to record all your share purchases and sales here.


Liability limited by a scheme approved under Professional Standards Legislation. Liability is limited in those States where a current scheme applies.   


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