I recently completed a manual off-market sell trade for a holding in a portfolio that is linked to Xero. I wanted the ‘Sale Allocation Method’ for the capital gain to be set to ‘minimise gain’ for the sold stock. The ‘Change Sale Allocation Method’ button is located in the CGT section.
A stock will only be listed in the Sale Allocation Method if there has already been a trade processed in SS for that holding.
Here’s the process:
- Book the trade in SS and tick ‘post to Xero’. This will post the gain to Xero based on the portfolio default allocation method. Do NOT reconcile the transaction in Xero
- FYI - Go into SS CGT report and note the gain shown in the report for the trade just done (noting there may be a lot of lines on the report if sale relates to multiple purchase lines). Also go into Xero and find the unreconciled account transaction which shows the same gain
- Go into SS CGT report and change the sale allocation method to preferred approach. Note the new gain from the report
- Now need to ‘push’ the new gain from SS to Xero. Go into the trade in SS and click ‘save’ (send to xero should still be ticked)
- Go into the transaction in Xero and the gain should have been updated and matches the updated gain from SS CGT report. The transaction can now be reconciled
If the xero trade has already been reconciled (or for some reason isn’t updated by the process above) then suggest
6. ‘remove and redo’ the outdated transaction in Xero,
7. go back to the trade in SS, uncheck send to zero and save.
8. Then go back into the trade and click send to zero and save. This will push a new transaction to Xero and reconcile
This step will be important for trades done during the tax year where you want to adjust CGT approach well after the fact when tax returns are being prepared