Taxation Law | Presentation

Taxation Law

Timing of CGT Event
 At the time of ascertaining the CGT event reference to case of “FCT v
Sara Lee Household & Body Care P/L (2000)” is made.
 The applicable agreement of sale characterizes the source of
obligation to carry-out the transfer of asset that amounts to relevant
sale.
 If it is found to be difficult in recognizing the sole contract under
which the sale happens, then the time is when the ownership of asset
changed.
 A taxpayer may engage in sale or get into a contract despite the fact
that the transferee is not regarded as the party to the contract.

Sale of Investment Property
 In the year 2018 on 14th June the property was sold for a market value of
$1.3 million. Accordingly, a CGT event A1 happened under “sec 104-10
ITAA 1997” when Harrison disposed the investment property.
 Referring to the case facts of “McDonald v FCT (1998)” the sales
proceeds derived from sale of investment property is a taxable capital
gains (Pinto, Kendall and Sadiq 2018).
 With reference to the “sec 102-5 ITAA 1997” the amount will be
included in the assessable income of Harrison and will attract CGT for the
year 2018.

Sale of Share Portfolio
 The shares were purchased by him in October 1985 and will be
categorized as “Post-CGT Asset”.
 On 20th June 2018, Harrison signed the share transfer document and
the transfer as well as the share script was handed to stock exchange
on 20th June 2018.
 Referring to “FCT v Sara Lee Household & Body Care P/L
(2000)” there was an exchange of ownership on 20th June when
Harrison transferred the share script to stock exchange.
 Hence, the timing of the “CGT event A1” under “sec 104-10 ITAA
1997” will be 20th June 2018 because the title of asset was disposed
on the aforementioned date.

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