I Bought Shares a Few Yrs Back.company Now Delisted. What Now?

cookie2 on 03/04/2017 - 16:59

Hi all,
I purchased shares in a company in 2012. that company has now been delisted off the ASX.
I am no expert on this stuff and I've read lots of things online but they are speaking financial gibberish to me and was hoping to get some direction on what I'm suppose to do now, and so of course, I came here for help! :)

I have seen that I can sell my shares (negligible) and this seems to be for taxation purposes so that I can claim a loss. am I correct in this understanding?

Also how does it work if I claim a capital loss on upcoming tax returns- ie does the loss get deducted from my total financial years income?

The company was delisted in 2015. Does this matter in regards to sale of shares or capital loss claiming?

Apologies if I haven't explained well. ask any questions needed.

Thanks all in advance. :)

Financial

Comments

  • mskeggs on 03/04/2017 - 17:22
    +2

    I haven't done this, but I understand you can sell the shares to crystallise the loss.
    That loss can then be off set against any capital gains you might have (say from the sale of other shares that went up). This reduces the amount of CGT you will have to pay.
    If you have no capital gains, you can roll the loss forward until one day you do.
    But you can't claim the loss against income from other areas except in very specific circumstances (such as you are a professional share trader).

    You should sell the shares, assuming they are near worthless. Whether you have gains this year or not is academic as you can carry the loss forward.

  • chumlee on 03/04/2017 - 18:14

    If it is delisted you can claim it as a capital loss in your next tax return or any future tax return as capital losses are allowed to be carried forward.
    You will not be able to write it off against but against any future capital gains.

    • kipps on 03/04/2017 - 19:19
      +2

      I thought you had to wait until the declaration that the shares are not likely to yield a return before claiming the CGT loss. If a liquidator/administrator was appointed then there will likely have been such a declaration. There mere act of delisting off the ASX is not enough.

      See http://www.delisted.com.au/capital-gains-tax/loss-declaratio… for more info.

      • chumlee on 03/04/2017 - 20:11

        My accountant tells me if there is no prospect of getting your money back just take the capital loss whenever you want

        • bluesky on 03/04/2017 - 20:57
          +1

          The loss declaration is sort of the evidence/confirmation for no prospect of getting your money back. If it is just one's own opinion, it could lead to questions by ATO later.

      • CyberMurning on 03/04/2017 - 22:34
        +1

        correct. wait for administrator official announcement, then put that loss on your current year tax return (to offset capital gain, not income). you cant sell the shares because it has been delisted. the registry/custodian/platform/broker will remove your holding few days/weeks/months after that administrator announcement as well.

  • bluesky on 03/04/2017 - 19:20

    You will not be able to offset it against your ordinary income. Unless your ordinary business is share trading, in which case, you can consider it a loss in the normal course of operations.

    Instead, as chumlee said, it can be used to offset capital gains (now or into the future) - provided a loss declaration has been made by the liquidator/administrator.

  • cookie2 on 03/04/2017 - 21:30
    +1

    thanks everyone. and by the way, it has been declared as well as delisted.
    so my understanding is for now, I should sell the share (to finalise it as a loss). I have no other shares re capital gains, but i understand people are saying if I do in the future than I can offset it against the loss. is this true even if years later? does this mean i should claim as a capital loss in this years tax return or not bother until future or is this completely incorrect? again, thanks to everyone for your help so far.really appreciated . :)

    • janezzy on 04/04/2017 - 07:35

      As someone who has some skin in the stock market - how do you sell shares that have been delisted? If they were delisted because the company went into administration then who's buying them?

  • chumlee on 03/04/2017 - 21:57

    Yes it carries forward indefinitely or until government makes a change

  • adenda on 04/04/2017 - 08:14

    The website delisted.com.au will buy worthless shares to allow the capital loss to be crystalised. There is likely a cost involved
    but they will then be "sold" and the capital loss (and selling costs) claimable against any capital gains in the year of sale or any future year. You can carry the loss forward for as long as you want until you have a capital gain to offset it against.
    If a liquidator has already declared them worthless then no need to sell them.
    They're not the only ones doing this I guess - try Googling 'sell worthless shares'.

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