Hi,
Would appreciate confirmation regarding Forex CG rules concerning $US share accounts.
For example:
1. Jan 1st 2020 - DEPOSIT AUD$10,000 -> USD$6,000 (USD/AUD 0.600)
2. Feb 1st 2020 - BUY US Stock 'ABC' -> USD$6,000 (USD/AUD 0.625) - $AUD Cost base:AUD$9,600 (6,000/0.625)
3. Mar 1st 2021 - SELL US Stock 'ABC' -> USD$60,000 (USD/AUD 0.750) - $AUD Proceeds:AUD$80,000 (60,000/0.750)
4. Jun 1st 2021 - WITHDRAW USD$60,000-> AUD$75,000 (USD/AUD 0.800)
Buy/sell transactions in $USD with applicable FX rates on transaction dates shown - ATO'12 month rule'.
No other transactions on account with balance at zero prior to 1.
My understanding is CG on stock sale would be AUD$70,400 (80,000-9,600) with 50% discount on shares held >1 year. So, a taxable CG of AUD$35,200 would be made in FY2020-21?
What I'm not sure about is tax calc when forex CG event is triggered on full withdrawal of deposit plus profits at (4). My assumption is Forex Event from withdrawal of USD$60,000(4) is solely concerned with original USD$6,000 deposit,
in which case, Forex CG/Loss is:
$AUD Deposit value at Withdrawal - $AUD Original Deposit value. i.e AUD$7,500 - AUD$10,000 (6,000/0.80) or a deductable loss of -AUD$2,500
Can an 'ATO user' or other well-informed member of forum show correct CG calc for withdrawal if this is not correct please?
Links referenced:
https://www.ato.gov.au/Business/Foreign-exchange-gains-and-losses/Forex-realisation-events/
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