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How is CGT calculated?

Discussion in 'Accounting & Tax' started by ryau86, 26th Oct, 2015.

  1. ryau86

    ryau86 Member

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    Hi All,

    If a person is on a personal income of $150k this financial year (i.e. 37c per $1 tax bracket) and sells a property in NSW and makes $150k profit after expenses, does it carry her capital gains into the highest tax bracket (i.e. 45c per $1)? She is also eligible for the 50% CGT discount too :)

    Also, when is CGT payable? After personal tax returns are lodged?

    Thank you.
     
  2. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    irrelevant where the property is.

    CGT after all expenses is then discounted and that figure is added to other income for the year. prob $75k in this case if property held more than 12 months.

    Payable after ATO issues a notice of assessment which is issued after lodging
     
  3. Scott No Mates

    Scott No Mates Well-Known Member

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  4. Paul@PFI

    Paul@PFI Tax Accounting + SMSF Business Member

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    CGT is not an additional tax but is a element of the taxation regime that adds additional income to the taxpayer. This can not only result in taxation at a higher marginal rate it can also lead to other levies and consequences : eg
    - Div 293 tax
    - Medicare Levy Surcharge
    - Private Health insurance tax offset
    - Net medical expenses tax offset at a different rate and threshold
    - Centrelink benefits (Family Tax Benefit)
    - HECS / Help debt repayments
    - Can adversely affect PAYG instalment calculations in some instances
     
  5. Rob G

    Rob G Well-Known Member

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    And the temporary budget repair levy.
     
  6. Paul@PFI

    Paul@PFI Tax Accounting + SMSF Business Member

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    Yes...(as was the flood levy)... At least the budget repair levy was forward dated a year and not retrospective across a broad class of taxpayers.