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Re: CGT after property stolen

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If I have property that is subject to CGT (captital gains tax) and it is lost or destroyed or stolen, is CGT still applicable, and due for payment in the year of loss or theft? Asuming the property is not insured......As a separate question, if the property is insured and Insurer pays under a policy of insurance, am I correct in assuming the loss or theft and insurance payout is a CGT event, and the "market value" at the time of the loss or theft is used to calculate the CGT owed (and not the insurance payout)?

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Hi @Goldman,

 

Thanks for your questions!

 

This may be classified as involuntary disposal of a CGT asset. CGT is still applicable, and if the involuntary disposal results in a capital loss then you can use that to reduce any capital gain made in the current income year or a later year.

 

Assuming you don't receive any replacement assets or compensation for the loss of the asset, then CGT would be reportable in the year that the item was stolen or that the theft was discovered.

 

If you do receive compensation for the loss of the asset, then the time of the CGT event is when you first received the compensation. The CGT event is calculated based on the amount that you actually receive, as well as the cost of repair or replacement and the amount of money that you actually use.

 

All of the information that you need is available in the above link if you'd like to have a look through it. There's a number of scenarios covered and some example calculations as well.

 

I hope this helps, but please let me know if you have any other questions.

 

Thanks,

 

Rachael B.

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Best answer

ATO Certified

TaxTime Support

Replies 0

Hi @Goldman,

 

Thanks for your questions!

 

This may be classified as involuntary disposal of a CGT asset. CGT is still applicable, and if the involuntary disposal results in a capital loss then you can use that to reduce any capital gain made in the current income year or a later year.

 

Assuming you don't receive any replacement assets or compensation for the loss of the asset, then CGT would be reportable in the year that the item was stolen or that the theft was discovered.

 

If you do receive compensation for the loss of the asset, then the time of the CGT event is when you first received the compensation. The CGT event is calculated based on the amount that you actually receive, as well as the cost of repair or replacement and the amount of money that you actually use.

 

All of the information that you need is available in the above link if you'd like to have a look through it. There's a number of scenarios covered and some example calculations as well.

 

I hope this helps, but please let me know if you have any other questions.

 

Thanks,

 

Rachael B.

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