Hi ATO
I’m wondering what the ATO’s official position is on which method should be used to calculate cost base of shares? (I.e. buy price)
My understanding is there are a few different methods.
I’ve previously used average cost base. Is this acceptable? Most Share Trading apps, calculate an average cost base or average buy price. It is simple to use this. Is this okay to use?
Thanks in advance.
[assuming this is for CGT]
You use the actual purchase price per share. You can do average price per share for each parcel (each purchase order), because you may need to split the parcel to match the number shares sold.
You do not do average price per share for all the shares you own.
EDIT: After doing your CGT calculation, remember to check that the leftover shares in your calculations match with the number of shares you still have with the broker
My understanding is there are a few different methods.
If you need more help, it might be worthwhile to see a tax agent.
Hello and thank you for your reply, yes I am referring to calculating capital gains tax.
I have a tax agent who recommended the FIFO method. I wanted to confirm with the ATO accept other methods?
On my Share Trading app, I have an average buy price for a particular share that I sold off. I used this as the base to calculate the gain from.
Is what I used considered the average buy price? I bought all the same shares in 1 day for almost the same price.
Thanks again in advance.
15 Apr 2026 · 8 min read time
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