{"id":569746,"date":"2023-05-14T15:18:42","date_gmt":"2023-05-14T12:18:42","guid":{"rendered":"https:\/\/www.etoro.com\/?page_id=569746"},"modified":"2025-10-29T12:32:47","modified_gmt":"2025-10-29T10:32:47","slug":"capital-gains-tax-australia","status":"publish","type":"page","link":"https:\/\/www.etoro.com\/au\/investing\/capital-gains-tax-australia\/","title":{"rendered":"Guide to CGT in Australia"},"content":{"rendered":"\n

When you sell assets, such as shares, property or cryptoassets<\/a>, you may need to pay capital gains tax (CGT). This means that you will pay a set amount of tax on your asset\u2019s profits. You can work out your CGT by using a CGT calculator.<\/p>\n\n\n\n

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This guide can help to make your investment journey<\/a> easier, particularly when it comes to understanding CGT<\/strong>, how to calculate it, and how you can potentially avoid it.<\/p>\n\n\n\n

The process of investing is actually very simple. You use a platform such as eToro<\/a> to deposit your funds, choose the stock you want to invest in, and then buy it. When you decide to sell, the process is just as straightforward. However, after you\u2019ve sold some or all of your shares<\/e-tip><\/strong> \u2014 especially if you made a profit \u2014 there\u2019s another step to the process: capital gains tax.<\/mark><\/p>\n\n\n\n

In Australia, if you buy stocks<\/a>, property or other assets<\/e-tip> and then sell them at a higher price<\/strong>, the difference between the buy and sell price is called \u201ccapital gains<\/strong>\u201d, and in many cases, the Australian Taxation Office requires that you pay tax on it.<\/p>\n\n\n\n

What is capital gains tax (CGT)?<\/h2>\n\n\n\n

Capital gains tax is a tax that you pay when you make a capital gain from the sale of shares<\/strong>, property or other assets. Having a \u201ccapital gain\u201d means that you sold for a price higher than what you paid for it<\/strong>, whereas a capital loss means that you sold for a price lower than what you paid for it.<\/p>\n\n\n\n

\"What-is-capital-gains-tax-CGT\"\"What-is-capital-gains-tax-CGT\"<\/figure>\n\n\n\n

It is your obligation <\/strong>to understand how capital gains tax works in Australia<\/a>, as you may be liable for fines if you calculate your CGT incorrectly at tax time or fail to pay it at all.<\/p>\n\n\n\n

The good news for investors is that the amount of capital gains tax that you end up paying will depend on a number of factors<\/strong>, such as how long you have owned the assets, your marginal tax rate, and whether you have accumulated any capital losses in the same tax period<\/strong> (which can reduce your overall tax obligations).<\/p>\n\n\n\n

The length of time that you hold your shares before selling them is extremely important in the context of capital gains tax. This is because if you have held them for more than 12 months and are an individual taxpayer, you will typically receive a 50% discount on CGT<\/strong>.<\/p>\n\n\n\n

What assets have capital gains tax?<\/h2>\n\n\n\n

If you are concerned about how capital gains tax may affect your financial situation, it is important to know which assets are subject to CGT and which are exempt<\/strong>. <\/p>\n\n\n\n

\"What-assets-have-capital-gains-tax\"<\/figure>\n\n\n\n

While not an exhaustive list, you will usually have to pay capital gains tax if you make a profit on the sale of assets.At the other end of the spectrum are assets that you can sell for a profit and not be liable to pay capital gains tax. As always, do your own research when you are selling an asset<\/strong> to make sure that you do not have to pay tax. <\/p>\n\n\n\n

<\/div><\/div>
<\/div><\/div>
Examples of assets you may pay CGT on<\/th>Examples of CGT-exempt assets<\/th><\/tr><\/thead>
Shares<\/a><\/td>Your main residence<\/td><\/tr>
Cryptoassets<\/e-tip><\/td>Cars, motorbikes and other vehicles<\/td><\/tr>
Foreign currency<\/a><\/td>Personal use assets that cost you less than $10,000<\/td><\/tr>
Real estate<\/td>Winnings from gambling and prizes<\/td><\/tr>
Collectibles (such as artwork and antiques)<\/td>Assets acquired before September 20, 1985<\/td><\/tr>
Personal use assets that cost you more than $10,000 (such as boats and furniture)<\/td><\/td><\/tr>
Intangible assets (such as contract rights, licenses, and leases)<\/td><\/td><\/tr><\/tbody><\/table><\/div><\/div><\/figure>\n\n\n\n

If you sell an asset where CGT is applicable, it will trigger a CGT event and you will need to include the pertinent details in your tax return for that financial year.<\/mark><\/p>\n\n\n\n

If you buy and sell many shares throughout the year, it may be wise to get help from an experienced tax agent<\/strong> to ensure that you don\u2019t miss any of your CGT liabilities.<\/p>\n\n\n\n

How does CGT impact my shares and other investments?<\/h2>\n\n\n\n

The most common CGT event<\/a> is when you sell your shares<\/strong> \u2014 whether for a profit or a loss. However, there are separate instances where CGT can impact your other shares or investments such as buying back shares, holding shares during a merger, or receiving payments that are non-assessable. <\/p>\n\n\n\n

How else may your shares be impacted:<\/p>\n\n\n\n