Hi , Please assist me.
If a business decides to buy and sell shares as an additional form of income, should the share sales be categorised as normal non - capital income ?
The exiting line of business is in manufacturing industry.
As far as I know the deciding factor would be the intention ,
If the shares were bought as an investment ( expecting dividends/ disposal gains) then its a capital event.
If to be traded as buy & sell ( mainly gains) then normal income.
So how could a buiness substantiate its intention ? Would a mere statement that " I (business owner) bought the shares with the intention of buy & sell " be enough as proof ?
E.g During a financial year a business buy a set of shares ( Intention is buy and sell) . But desipite the ability to dispose and an earn a profit , the business holds on to the shares expecting the value to apprecciate more.
Also this is the only purchase it made in a while ( no regular buy and sell)
After a few years the disposal is made and owner expects to account as normal income . Is it allowed ?
How regularly should buy and sell happen to convice ATO that it indeed is buy and sell ?
What substantiation is required ?
Sorry for the too many questions.
Thank you
