All Topics / Hotch Potch / Capital Gains Tax

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  • Profile photo of melbearmelbear
    Member
    @melbear
    Join Date: 2003
    Post Count: 2,429

    Hi all

    Can anybody clarify for me how the CGT is calculated? I know it’s taxed at your marginal rate or half that if you’ve held it for 12 months.

    What I am unsure of is if you earn $30K, is it taxed at 30% for all of it, or does it push you up into the next tax bracket?

    Example.

    I earn $45K (30% bracket). I have a capital gain of $30K (after halving). Does the taxman say – 30% of $30K, or does he say, add that to your taxable income, and you now earnt $75K, with the resultant tax?

    Cheers
    Mel

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,213

    Mel

    The gain is just added onto your taxable income. In your example, your income would go to $75,000 and you would pay tax on this amount.

    There is a booklet available for download from the ATO webiste or a paper copy can be sent if you call them up.

    Terryw
    Discover Home Loans
    North Sydney
    [email protected]

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://www.Structuring.com.au
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au

    Profile photo of melbearmelbear
    Member
    @melbear
    Join Date: 2003
    Post Count: 2,429

    Bugger!![:(!][xx(] Thanks Terry, that is what I thought, but with all the general – you pay tax at your marginal rate ie. if you earn 30K you pay tax at 30% doesn’t leave room for the ‘bracket creep’.

    Cheers
    Mel

    Profile photo of muppetmuppet
    Member
    @muppet
    Join Date: 2003
    Post Count: 900

    Hi Mel

    Just a reminder that there is NO Capital Gains Tax in NZ.

    Yippeeeeeeeeeeeeee

    Regards

    Profile photo of melbearmelbear
    Member
    @melbear
    Join Date: 2003
    Post Count: 2,429

    Muppet

    As I was clicking on this link seeing you as the last poster I was thinking to myself

    ‘Don’t Gloat Muppet!!!'[:(!]

    Too late. I’d love to invest in NZ, but unless you want to find the deals for me I’m better off trying to get my affairs (in all senses[:P]) sorted here in Aust.

    Cheers
    Mel

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