Understanding Capital Gains Tax (CGT) – What You Need to Know

Capital Gains Tax (CGT) is a key consideration when selling assets such as property, shares, or a business. At Krystal Advisory, we help clients navigate the complexities of CGT to ensure they understand their obligations and take advantage of any available exemptions or discounts.

What is Capital Gains Tax?

Capital Gains Tax is the tax you pay on the profit (or capital gain) when you sell a capital asset for more than you paid for it. This could include:

• Real estate (investment properties)

• Shares and other investments

• Cryptocurrency

• Business assets

If you make a capital loss, you may be able to use it to offset future capital gains.

Common CGT Scenarios

• Selling an Investment Property: CGT applies to the profit made unless it’s your main residence, which may be exempt.

• Shares and Investments: Selling shares or managed funds can trigger CGT, especially if they’ve appreciated over time.

• Business Sales: Small business owners may be eligible for CGT concessions when selling their business.

How is CGT Calculated?

Your capital gain is calculated as the difference between the cost base (purchase price plus associated costs) and the sale price of the asset. The gain is then added to your taxable income and taxed at your marginal rate.

If you held the asset for more than 12 months, you may be eligible for a 50% CGT discount (for individuals and trusts).

How We Can Help

At Krystal Advisory, we work closely with you to:

• Accurately calculate your capital gains or losses

• Identify if any exemptions, discounts, or rollover relief apply

• Strategically time asset sales to minimise your CGT liability

• Ensure proper reporting on your tax return

Thinking of selling an asset? Talk to us first. A little planning can save you thousands in tax.

Contact us today to discuss your situation and make smarter financial decisions with confidence.

Phone: 0473144739

Email: admin@krystaladvisory.com.au