Taxation Report example - events relating to holding sold

In this example, a fictitious company has been through a complex series of transactions over a period of 7 years.

Here's the sequence of events:

1/1/96	Original purchase - ASX code AXXCA, Acme Industries Instalment Receipts. 5,000 units bought at $1.00 each. There was $50 brokerage.
2/7/97	Paid a further 50c on each share, converting them to fully paid shares - code AXX, Acme Industries Pty Ltd
31/8/99	A 2 for 1 share split. Total holding now 10,000 shares
1/10/01	Part of the parcel, 2,000 shares, were sold at $4 each. 8,000 shares remain in the portfolio
1/4/03	Capital return of 20c per share
1/10/03	Sell 5,000 shares at $4.50. Brokerage (including GST) was $55. After the sale, the remaining holding was 3,000 shares.

The sale on 1/10/03 is assessable in the 03/04 financial year. Let's see how Topshare handles this...

Extracts from Topshare's Taxation Report for 03/04

First, Topshare displays the summarised Capital Gains assessment for the sale in October 03.

This is the level of detail required to complete your tax return:

The total assessable Capital Gains is $9,835, as assessed under the 50% discount rule.

The remaining components of the Taxation Report are optional - they're only provided if specifically requested. These optional tables display the details of how the Capital Gains calculations were made, and the original parcel tracked through the various events.

In the first of these, Topshare displays the entire history of this holding prior to the sale:

Note how the the share parcel has been tracked right back to it's original purchase - even though the ASX code has changed!. The number of shares in the parcel, and its Cost Base, are tracked through the various events.

Next, Topshare displays the parcel details immediately before the sale, the details of the sale itself, and (if appropriate) any remaining shares after the sale - including their now-reduced cost base.

In the table above, the pre-sale Cost Base of $4,440 is distributed pro-rata between the 5,000 shares sold (Sale Details: Cost base = $2,775), and the 3,000 remaining (Rem. After Sale: Cost base = $1,665).

(Note: the previously-shown "Holdings Alterations" table details how the pre-sale Cost Base of $4,440 is arrived at).

Finally, the detailed capital gains calculations are shown:

This shows the detailed calculations according to each of the Capital Gains rules that apply (the results are in the shaded columns). This particular sale could be assessed according to either the "Indexation Rule" or the "50% Discount Rule" - however the latter gives, by far, the most advantageous result