Capital gains tax discount requirements

To be a discounted capital gain the capital gain must:

  • be made by a resident individual, trust or complying superannuation fund
  • result from a CGT event happening after 11.45am on 21 September 1999
  • be calculated with reference to an unindexed cost base; and
  • result from a Capital Gains Tax (CGT) event happening to a CGT asset owned by the taxpayer for at least 12 months.

For resident individuals and trusts the CGT discount is 50% and for superannuation funds the discount is 33⅓%. Companies and non-residents are not entitled to receive any discount.

Offsetting capital losses

For individuals, a capital loss must be offset against a capital gain before the 50% discount can be applied. The capital loss must therefore be offset against the gross capital gain.

Capital gains tax concession amounts

The CGT concession amount represents the non-assessable CGT discount component distributed to investors by listed trusts or unlisted managed funds. 
 
Such amounts are made through the sale of assets held for at least 12 months. Investors are not required to adjust the cost base of their units for such amounts paid on or after 1 July 2001.

We’re advised by the product issuer as to whether 50% of the gross discountable gain is distributed as the non-assessable CGT concession amount. 
 
This amount may not be 50% of the gross discountable gain because, for example, of the way in which the product issuer has allocated expenses.

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