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Ann: Change in substantial holding from MIN, page-105

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barneydigs

6,461 Posts.

1999

03/03/23

01:01

Post #: 66573981
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Originally posted by RedRooster2: ↑

Hey Jase71
A CGT event occurs when you sell a capital asset. Now for instance selling your main residence is not included as a CTG event, but selling shares most certainly is.
What happens is a CGT calculation needs to be prepared and reported in your tax return to the ATO by yourself or a tax agent.
The crux of it is that if you bought an asset for $10000 and sold it for $50000 you would be liable for CGT of $40000 and this amount would be added to your existing income for that financial year and you would pay the required tax for that totall taxable income.
In the event that that you have held the asset in excess of 12 months, then you qualify for the a CGT discount of 50%. So you would only add $20000 to your taxable income saving a substantial amount of tax, put your own figures in.
Now with the situation of a TO in progress, corporate jurisdiction with regard to CGT has consequences as many have been posting and it is particularly relevant to those that have accepted the MIN offer. If MIN do not acquire 80% of their TO target at offer end, then there will be no CGT roll over relief, in other words a CGT event has occurred and if you had qualified previously for the 12 month discount from your previous holding it will no longer be available and you would be required to report CGT event in your tax return, but unfortunately it would be for the full amount without any prior qualified discount. Then if you choose to sell before you have held the shares for longer than 12 months, you would again be liable to report the CGT in your tax return, but without any discount applicable.
I recommend all get proper advice on their own situation as there are actions that can minimise CGT and your tax payable and the ATO does offer other CGT exemptions.
Hope that is helpfull.
my opinion only not advice.

then it would not apply

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This is incorrect. You still get the capital gains discount on the sale of your NWE shares. You will not lose the discount regardless of if they get to 80% or not. But yes get tax advice from an expert because some of the shite sprouted here is laughable.

NWE Price at posting: 6.4¢ Sentiment: Hold Disclosure: Not Held
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