Capital Gains Tax
Selling assets? Know when CGT applies and how to reduce it
CGT Basics
When you sell an asset for more than you paid, the profit is a capital gain
What Triggers CGT
CGT applies when you sell or dispose of a CGT asset — shares, property, crypto, or other investments. The gain is added to your taxable income.
Example
Bought shares for $10,000, sold for $15,000 — you have a $5,000 capital gain that gets added to your tax return.
CGT-Exempt Assets
Cars, motorcycles, personal use assets costing $10,000 or less, collectables acquired for $500 or less, and assets acquired before 20 September 1985.
Example
Sold your car for a profit? No CGT. Sold a boat you bought for $8,000? No CGT on personal use assets under $10,000.
50% CGT Discount
Hold an asset for over 12 months and halve the taxable gain
Individuals — 50% Discount
If you've owned the asset for at least 12 months before selling, you only pay tax on half the capital gain. The 12-month count excludes both the purchase and sale dates.
Example
Made a $20,000 gain on shares held for 2 years — only $10,000 is added to your taxable income.
When the Discount Doesn't Apply
Companies can't use the CGT discount. Foreign and temporary residents lost access after 8 May 2012. The discount also doesn't apply to assets held less than 12 months.
Example
Bought and sold crypto within 6 months? No discount — the full gain is taxable.
Capital Losses
Losses reduce your gains — but watch the categories
Using Losses to Offset Gains
Capital losses are subtracted from capital gains before the 50% discount is applied. For the best result, apply losses to non-discounted gains first.
Example
Made a $10,000 gain on shares and a $4,000 loss on crypto — you only pay CGT on $6,000 (before any discount).
Carrying Losses Forward
No time limit — carry forward net capital losses indefinitely until you have gains to offset. Apply older losses before newer ones.
Example
Lost $15,000 on shares in 2022 and had no gains. In 2025 you make a $20,000 gain — apply the $15,000 carried loss first, so only $5,000 is taxable.
Collectable Loss Restrictions
Losses on collectables (art, jewellery, antiques, coins, stamps) can only offset gains from other collectables — not shares, property, or crypto.
Example
Lost $3,000 selling a painting — you can't use that to reduce a $10,000 gain on shares. But you can carry it forward to offset a future art sale.
Losses You Can't Claim
Losses on personal use assets (boats, furniture, appliances), CGT-exempt assets (cars, motorcycles), and collectables under $500 are ignored.
Example
Sold your old boat for less than you paid? Can't claim the loss — personal use assets losses aren't deductible.
Main Residence Exemption
Your home is usually CGT-free — with some exceptions
Full Exemption
Your main residence is generally exempt from CGT. This includes up to 2 hectares of land around the home.
Example
Bought your home for $500,000, sold it for $900,000 — no CGT on the $400,000 gain.
Partial Exemption
If you rented out your home, used it for business, or it sits on more than 2 hectares, you may only get a partial exemption.
Example
Lived in your home for 5 years, then rented it out for 3 years — you get a partial exemption based on time lived in vs rented.