Document ID: chunk:federal_register_of_legislation:C2004C00958:clause:1_14:p32
Version: federal_register_of_legislation:C2004C00958
Segment Type: clause
Provision Reference: sch 1 cl 14 (pt 32/40)
Character Range: 112132–114623

from that event are replaced with the market value of the shares or the interest in the trust as if the fall in the market value of collectables and personal use assets had not occurred: see section 116‑80.

 (5) The time of CGT event K5 is the time of *CGT event A1, C2 or E8.

 (6) You make a capital loss from a *collectable equal to:

 • the market value of the *shares or the interest in the trust (worked out as at the time of *CGT event A1, C2 or E8 as if the fall in market value of the collectable had not occurred);

less:

 • the actual *capital proceeds from CGT event A1, C2 or E8.

Example: You own 50% of the shares in a company. You bought them in 1999 for $60,000. The company owns a painting worth $100,000 and another asset worth $20,000. The painting falls in value to $50,000.

 In 1999 you sell your shares for $35,000 (the actual capital proceeds). You would otherwise make a capital loss of $25,000.

 However, the actual capital proceeds are replaced with $60,000 (the market value of the shares if the painting had not fallen in value).  You do not make a capital loss from selling the shares.

 You do make a collectable loss equal to:

Note: You can subtract capital losses from collectables only from your capital gains from collectables: see section 108‑10.

104‑230  Pre‑CGT shares or trust interest: CGT event K6

 (1) CGT event K6 happens if:

 (a) you own *shares in a company or an interest in a trust you *acquired before 20 September 1985; and

 (b) *CGT event A1, C2, E1, E2, E3, E5, E6, E7, E8, J1 or K3 happens in relation to the shares or interest; and

 (c) there is no roll‑over for the other CGT event; and

 (d) the applicable requirement in subsection (2) is satisfied.

 (2) Just before the other event happened:

 (a) the market value of property of the company or trust (that is not its *trading stock) that was *acquired on or after 20 September 1985; or

 (b) the market value of interests the company or trust owned through interposed companies or trusts in property (except trading stock) that was *acquired on or after 20 September 1985;

must be at least 75% of the *net value of the company or trust.

 (5) The time of CGT event K6 is when the other event happens.

 (6) You make a capital gain if the part of the *capital proceeds from the *shares or interest that is reasonably attributable to the market value of property referred to in subsection (2) is more than the sum of the *cost bases of that property.