If I purchase $1000 of Z stock and 3 years later it is worth $5000 and I sell $1000 worth of Z stock, does that trigger a CGT taxable event?
Do I Have to Pay CGT on My Initial Investment?
SpicyStew on 28/02/2024 - 03:19
Comments
You are selling 20% of your asset. 20% of your original price is $200. Therefore your capital gain from the original $200 to the sale price of $1,000 is $800. Capital Gain is $800 which is what the Tax Man wants to know about.
Great reply. The good news for OP is that they'll get a 50% CGT discount because they have owned the asset for more than 12 months
Rather than work out % of asset being sold, would it be best to just calculate it all at cost per share basis? Just incase % don’t work out perfectly etc
If you bought them at different times, you have four options to use to calculate based on ATO policy: FIFO, LIFO, average cost, discretionary selection.
If on any of the four bases a CG is generated, then yes.
Not correct
I wouldn't stick average cost in here as it can only be used in specific circumstances (i.e. when you've made multiple purchases on the same day then you can average it out)
Sorry, should have written average cost*
If he doesn't now the T&C of the * then he should use an accountant.
Then when you sell the remaining amount later you pay 0 CGT as you’ve already sold the initial $1000 you invested
mmm, might need to think about that answer a bit more (or is it a joke answer?)
god i hope they were serious when answering
Cmonnnnn guys
People having trouble with sarcasm today.
If you read any finance forums, you will quickly learn that this answer is nowhere near the most wrong tax advice you will see
I don't, but this was made fairly obvious, in the "infinite money hack" style.
At least u get me brother
You need to include the /s
OP might actually take you seriously.
Came for tax fraud confirmation, vot the advice OP 100% didn't want.
this makes
sensecents thanks
You must be a younglin and new to the tax system. CGT has been around since 1985.
Think twice before you try and evade your crypto tax obligations. The ATO have auditing and data matching tools to monitor your crypto exchange transactions using KYC against what went into your bank account.
does that trigger a CGT taxable event?
Yes…
You've made a capital gain…
not from the initial $1000 i have not
*facepalm.
You've made a $4k capital gain.
That's a capital gain event.$4k is not realised gains, gains is at point of sale only
@SpicyStew: I clicked the green plus because between this and your crypto tax-haven plan it's endearing and adorable how much you hate the idea of paying tax and I wish you the best in your crusade against the ATO.
@SpicyStew: Please don't become an accountant. You can't just withdraw your initial capital. The ATO treats any withdrawal automatically as you taking from your profit. You don't get a bucket which you can say "initial investment".
not from the initial $1000 i have not
From the 20% of stock you're selling you have.
Yes