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Australian CGT discount

Australia: individuals holding an asset more than twelve months generally include only half the capital gain in assessable income; active traders may instead be taxed on revenue account.

The discount is 50% for individuals and trusts and one third for complying superannuation funds, with no discount for companies. The twelve-month holding-period is measured from the day after acquisition to the contract date of disposal.

Traders classified as carrying on a business of share trading are taxed on revenue account instead. Profits are ordinary income with no discount, stock is valued as trading stock at year end, and losses are deductible against other income rather than quarantined as capital losses.

The Australian Taxation Office weighs business-like operation, repetition and regularity, volume, a trading plan and record keeping when deciding, and taxpayers cannot simply choose the more convenient answer each year.

This is general information about Australia, not tax advice. Rules change and depend on your circumstances; consult a qualified adviser or ato-australia.

Related: ato-australia, holding-period, capital-loss-carryover, asic, long-term-capital-gain

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