tullow price aust dollar, page-16

Hi glennus

I receive an income from the UK but do not pay tax in the UK. The UK income goes on my ATO return.

Capital Gains tax is part of the ATO income tax system and I cannot see how I am obliged to pay CG tax in the UK. I have worked on the principle that the percentage of Hardman shares bought for cash is the basis for capital gains in 2007. What I received for those shares less what I paid for those shares is my capital gain so far and this is subject to 50% for holding more than 1 year.

When I sell the Tullow shares and receive the proceeds in Australian dollars, I will calculate my capital gain on the percentage of HDR shares converted to Tullow shares. I will probably hold the Tullow shares for more than 1 year, but if I don't I will use the purchase date of the HDR shares in calculating the taxable income.

I can't see any other way to do the calculations and I will argue the case with the UK Tax Office and the ATO if they disagree. I hope it doesn't come to that.

regards

Complex