How to enter inherited shares - Australia
I have inherited shares and I am not sure what date to enter as purchase date. Do I enter the date they were originally purchased by my mother or do I enter the date they were received by me?? I understand that in Australia the shares carry capital gains from the date of original purchase until the date sold. Thanks for any help. JoJo
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Hi JoJoInvest,
I recently went through this with my own mother’s shares. In Australia you would need to enter the original purchase date and price of the shares when your mother bought them. Then when or if you sell them, the capital gain is worked out based on the original purchase date/price and Sharesight will correctly calculate the capital gains amounts.
Hi, I’ve got a similar scenario, however… I’ve previously traded the same Company’s shares over the years, and the inheritance pre-dates them. If I simply add the newly inherited shares, they disrupt all previous CGT reports and transactions. How do I avoid this?
E.g. (Hypothetical) : I bought 100 shares in CBA in Jan2008 for $50/share (Total of $5000). I later sold them in Jan 2010 for $70/share (Total of $7000). My Capital Gain for FY09/10 is $2000, less 50% discount, therefore taxable of $1000 to my income tax. I then inherited 100 shares which were originally purchased in 2002 for $30/share. If I let Sharesight develop the report, it will now treat the 100 shares I sold in Jan 2010 as selling the 2002 share pack, not the 2008 sharepack. As such, my CGT report for FY09/10 is now a gain of $4000 (compared to the previously submitted $2000 to the taxman).
Additional: By adding the date as 2002, Sharesight now reports all dividends potentially received…
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It depends on when the deceased acquired them. Pre Sept 85 the date of acquisition is from the date you got them from the estate. If they were acquired by the deceased post Sept 85 you use the date the deceased acquired them
I have exactly this issue.
Tricky issue…
It might be possible to play around with the sale allocation method for that holding for that period and then lock the allocation to try to trick SS into not changing the gain. Pretty fiddly and not likely to work.
My suggested workaround is to put the acquisition date of the inherited shares at a later date (after the last sale of that stock) but at the original cost (and leave the correct date as a comment on the trade). Providing you’re not trading that stock a lot then the holding period should be more than 12 months (so you get the 50% discount) and the cost base will be correct. If you then realise any shares you can play with the allocation method to adjust how CGT is calculated.
Obviously that doesn’t work for pre '84 shares - in that case you can still use this method - but you’ll need to do an off system note/adjustment to CGT report when you sell.
Hope this helps!