Allkem General Discussion, page-1825

Here's an interesting consideration wrt selling stock to eg fund property purchase....

Selling in one go compared to selling down over multiple financial years...?

Simplified scenario:
Assume $1M of stock
Assume no other income
Assume CGT discount applies

Option A: (outright purchase)
Sell $1M stock in one hit
Assume $800k profit
Pay tax circa $150k
$850k in pocket
(85% in pocket)

Option B: (outright purchase)
Sell stock across 2 financial years
eg. sell $500k stock in June and $500k in July
Assume $800k (2 x $400k) profit as before
Pay tax circa $120k total (2 x $60k/yr)
$880k in pocket; pays for the kitchen renovation lol
(88% in pocket)

Option C: (pay down loan over time)
Sell stock gradually over say 10 years
ie. sell $100k per year
Assume $80k profit per year
Pay tax $40k total (10 x $4k/yr)
$960k in pocket
(96% in pocket)

For option C:
Need to factor inflation effects
Need to factor sp growth over time
Need to factor potential dividends over time
Need to factor interest rate for cost analysis and comparisons... etc


Just some food for thought and NOT ADVICE in any way.

IMO some careful thought + option C (or some variation of) might be a very interesting choice....?

Thoughts?