Ann: SOR Powers Bluetooth Sensor Device with Moisture, page-33

This is a little off topic, but I felt the need to reply. Regardless of what TMF say, and maybe even in spite of it, I still wouldn’t risk selling an asset, purely for CGT reasons, within 3 days of EOFY.

The ATO says the following represents a CGT event WRT sale of assets:
”When the disposal contract is entered into, or, if none, when the entity stops being the asset’s owner.”

And specifically for shares (Item G)

It is a CGT event when “Capital payment for shares”.

This all seems to be purposefully misleading and able to be interpreted in different ways.

https://www.ato.gov.au/General/Capital-gains-tax/Selling-an-asset-and-other-CGT-events/Types-of-CGT-events/#DisposalA

But regardless of any wording issues: a concern of mine is whether or not a share sale contract note constitutes a legally binding contract and whether this signals unchallengeable transfer of ownership of the asset. I feel that is necessary for it to be a CGT event.

It may seem obvious by the word “contract” being included in the phrase “contract note’. But I believe this is complicated by the addition of the word “note” and also by what I have observed.

I, and I expect everyone else here, have witnessed the ASX nullifying sell and buy contract notes when they have expected market manipulation or glitches in the system. As such I don’t think execution of the sale would stand a court challenge of satisfying the CGT event ruling as clearly the original owner has not yet lost ownership of the asset and the contract can obviously be nullified and overturned.

IMHO, money being transferred to seal the buy/sell match is unchallengeable proof that the asset has changed ownership. So I play on the safe side and use settlement dates both for my buys and my sells.

Anyone else can chose to read into this whtever they feel fit. Personally, I’d rather not challenge the ATO on any matter.