ok, from my accountant (who is also a close mate so excuse the informal language)
"It works like this if you trade enough during a year you will cease to be considered a passive investor and be assessed as a share trader. Basically a share trader is defined as someone who trades on a consistent basis. It looks at the repetition of your trading and your intention of trading eg are you their to make a quick buck so to speak. It looks at stuff like record keeping, amount of time spent on it, amount of capital put into etc etc.
If you are classed as a share trader then you are basically classed as running a business and will be assessed in full on the profit you make. From what you are saying it sounds like you fall under this category. As I like to say you can?t have your cake and eat it to. (Still don?t get the saying)
If on the other hand your trade on an inconsistent basis with the same parcel of shares say for example 5 times a year as appose to 10, then it works on a first in first out system.
So you buy 10,000 shares for a $1 on the 1/7/11
A Further 20,000 shares for a $1.50 on the 10/07/11
If in 12 months you sold 15,000 shares for $2
Your cost base will be 10,000 @ $1 and $5000 at a 1.50.
The infrequency of this transaction will get you the discount."
SSN Price at posting:
14.0¢ Sentiment: Buy Disclosure: Held
