CAPITAL GAINS TAX (CGT)

Course overview

Capital gains tax (CGT) is a fundamental component of the Australian tax system, affecting individuals and businesses upon the disposal of capital assets. This professional course provides a comprehensive overview of CGT in Australia, explaining when and how CGT applies, methods for calculating capital gains or losses, and the various exemptions and concessions available (such as the principal residence exemption and small business CGT concessions). Through detailed topics and real-life examples, participants will deepen their understanding of CGT events, compliance requirements, and planning opportunities in a professional context.

Course objectives:
– Understand the key concepts and triggers of Australia’s capital gains tax (CGT) and how it fits within the income tax system.
– Identify different categories of CGT assets and events, and determine when a CGT event results in a taxable capital gain or loss.
– Apply CGT exemptions and rollover relief provisions, including the principal residence exemption and other specific CGT exemptions, to various scenarios.
– Calculate capital gains or losses accurately, accounting for cost base elements, indexation (where applicable), the CGT discount, and the treatment of capital losses.
– Examine special CGT concessions for small businesses and other special circumstances (such as foreign residency changes, deceased estates, and cryptocurrency transactions) to ensure compliance and optimal tax outcomes.

Learning outcomes:
Upon completing this course, participants will be able to:
– Explain the scope of CGT in Australia and determine whether a transaction or event will trigger a CGT liability.
– Classify assets and transactions under the appropriate CGT event category and distinguish between taxable and non-taxable (exempt) events.
– Evaluate eligibility for key CGT exemptions (including the principal residence exemption) and rollover provisions, and advise on their application in practical scenarios.
– Perform CGT calculations for a variety of assets, correctly computing capital gains or losses and applying discounts or indexation as appropriate.
– Advise small business clients on the availability of CGT concessions (15-year exemption, 50% active asset reduction, retirement exemption, and rollover) and integrate these concessions into tax planning strategies.
– Ensure compliance with CGT record-keeping requirements and utilise checklists to identify potential CGT implications for clients, including considerations for foreign residents, deceased estates, and emerging asset classes like cryptocurrency.