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I second Novocatrian's advice on getting an Accountant. Don't take the following as advice. I am not an Accountant nor do I play one on TV and neither is my advisor chatgpt for that matter.

If I buy a stock for 20c and sell for $1.00 in Australia after holding for 3 years, what taxation/capital gain am I up for.

ChatGPT said:

Thought for 30 seconds

1. Work out the gross capital gain

	Item	Amount (per share)
1	Sale price	$1.00
2	Less cost base (purchase price)	$0.20
3	Gross capital gain	$0.80

Because you bought the shares after 21 September 1999 the indexation method is not available, so the “discount method” applies. ato.gov.auato.gov.au

2. Apply the 12-month CGT discount

• You held the shares for 3 years, well over the 12-month rule.

• If you are an Australian-resident individual or trust, you can reduce the gain by 50 %.

• A complying super fund gets a one-third discount (effectively 33 ⅓ %).

• Companies do not receive any CGT discount.ato.gov.auato.gov.auato.gov.au

	Entity type	Discount	Net capital gain per share
1	Individual / trust	50 %	$0.40
2	Super fund (accumulation phase)	33 ⅓ %	$0.53
3	Company	0 %	$0.80

(If you have carried-forward capital losses, you must deduct those before applying the discount.) ato.gov.au

3. Bring the discounted gain into your tax return

Capital gains are not taxed separately—they are added to your other assessable income for the year:

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Taxable capital gain = Discounted gain + other taxable incomeIncome tax payable = Apply marginal tax table + 2 % Medicare levy (if applicable)

For 2024-25 the resident marginal rates are: 16 % (>$18,200), 30 % (>$45,000), 37 % (>$135,000) and 45 % (>$190,000). ato.gov.au

Simple example (individual)

Suppose you sold 10,000 shares:

• Proceeds $10,000

• Cost base $2,000

• Gross gain $8,000

• 50 % discount $4,000

• Add $4,000 to your taxable income.

If your total taxable income (including the $4,000) sits inside the 30 % bracket, tax on the share sale itself is:

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$4,000 × 30 % = $1,200Medicare levy 2 % = 80Total tax on the gain = $1,280After-tax profit = $8,000 – $1,280 = $6,720

4. Things to double-check before you lodge

	Check-point	Why it matters
1	Capital losses	Must be applied before the discount.
2	Residency status	Non-residents get no discount after 8 May 2012.
3	Holding period	The ATO counts from contract date to contract date (exclude the two contract days).
4	Small-business or main-residence concessions	May further reduce CGT for qualifying taxpayers.
5	Super in pension phase	Capital gains on assets that support a retirement-phase pension can be fully tax-free.

Key take-aways

1. Your economic gain is 80 ¢ per share.

2. If you are an Australian-resident individual, only 40 ¢ of that is taxed.

3. The actual tax bill depends entirely on your marginal income-tax bracket (plus Medicare).

4. Keep records of purchase and sale contracts, brokerage, and any capital-loss worksheets—audits of share transactions are common.

Disclaimer – This is general information based on the legislation and ATO guidance current to 10 June 2025. It is not personal tax advice. Confirm your exact position with a registered tax agent.