Document ID: chunk:federal_register_of_legislation:C2004C00958:clause:1_14:p6
Version: federal_register_of_legislation:C2004C00958
Segment Type: clause
Provision Reference: sch 1 cl 14 (pt 6/40)
Character Range: 51057–53608

owned by the company or trust) less the assets' cost bases  no capital loss

[See section 104‑230]

[This is the end of the Guide]

Subdivision 104‑A—Disposals

104‑10  Disposal of a CGT asset: CGT event A1

 (1) CGT event A1 happens if you *dispose of a *CGT asset.

 (2) You dispose of a *CGT asset if a change of ownership occurs from you to another entity, whether because of some act or event or by operation of law. However, a change of ownership does not occur:

 (a) if you stop being the legal owner of the asset but continue to be its beneficial owner; or

 (b) merely because of a change of trustee.

 (3) The time of the event is:

 (a) when you enter into the contract for the *disposal; or

 (b) if there is no contract—when the change of ownership occurs.

Example: In June 1999 you enter into a contract to sell land. The contract is settled in October 1999. You make a capital gain of $50,000.

 The gain is made in the 1998‑99 income year (the year you entered into the contract) and not the 1999‑2000 income year (the year that settlement takes place).

Note 1: If the contract falls through before completion, this event does not happen because no change in ownership occurs.

Note 2: If the asset was compulsorily acquired from you: see subsection (6).

 (4) You make a capital gain if the *capital proceeds from the disposal are more than the asset's *cost base. You make a capital loss if those *capital proceeds are less than the asset's *reduced cost base.

Exceptions

 (5) A *capital gain or *capital loss you make is disregarded if:

 (a) you *acquired the asset before 20 September 1985; or

 (b) for a lease:

 (i) it was granted before that day; or

 (ii) if it has been renewed or extended—the start of the last renewal or extension occurred before that day.

Note: You can make a gain if you dispose of shares in a company, or an interest in a trust, that you acquired before that day: see CGT event K6.

Compulsory acquisition

 (6) If the asset was *acquired from you by an entity under a power of compulsory acquisition conferred by an *Australian law or a *foreign law, the time of the event is the earliest of:

 (a) when you received compensation from the entity; or

 (b) when the entity became the asset's owner; or

 (c) when the entity entered it under that power; or

 (d) when the entity took possession under that power.

Note: You may be able to choose a roll‑over if an asset is compulsorily acquired: see Subdivision 124‑B.

 (7) CGT event A1 does not happen if the