WHAT IS THE TAX LAW REGARDING PRECIOUS METALS IN AUSTRALIA

Discussion in 'General Precious Metals Discussion' started by John s, Jul 29, 2020.

  1. John s

    John s New Member

    Joined:
    Jul 28, 2020
    Messages:
    21
    Likes Received:
    18
    Trophy Points:
    3
    Hi all i would love it if someone could shed some light regarding the tax law associated with precious metals. I called the ATO regarding this matter and no one could give me an answer.

    -Is there capitals gains tax if so whats the percentage to the dollar?

    -Is there anything else i should know? (As I dont want to breach the law)
     
  2. mmm....shiney!

    mmm....shiney! Administrator Staff Member Silver Stacker

    Joined:
    Nov 15, 2010
    Messages:
    18,613
    Likes Received:
    4,398
    Trophy Points:
    113
    You pay Capital gains Tax at your marginal rate (in other words it's added on to your income) on any profits you make. If you hold the asset for longer than a year you get a 50% deduction on the net gain (profit after expenses) you made.

    Say you have a job that pays you $70 000/annum. You sell bullion at a net gain of $10 000 within 12 months of its purchase. Your total taxable income will be $80 000 for the year. And you will have a total tax liability of around $17 500.

    Say you have a job that pays you $70 000/annum. You sell bullion at a net gain of $10 000 which you held for at least 12 months so you get a 50% discount on the net income earned for that asset ie taxable income is now $5 000 instead of $10 000. Your total taxable income will now be $75 000 for the year instead of $80 000. And you will have a total tax liability of around $16 000.

    Click on the thumbnails below to see the calculations.

    Screen Shot 2020-07-29 at 9.25.13 am.png

    Screen Shot 2020-07-29 at 9.29.42 am.png

    You cannot claim a loss against any other income earned but you can offset that loss against any other capital gain.

    Keep receipts or a record of your purchases. Don't smoke on planes and indicate when turning.
     
  3. leo25

    leo25 Well-Known Member Silver Stacker

    Joined:
    Jun 8, 2010
    Messages:
    3,585
    Likes Received:
    1,939
    Trophy Points:
    113
    Yes and the tax would be whatever your tax bracket is. But if you only sell a coin every blue moon then i wouldn't worry about declaring anything as it's more of a hobby rather than investment.
     
    John s and Silverling like this.
  4. Silverling

    Silverling Well-Known Member Silver Stacker

    Joined:
    Aug 13, 2017
    Messages:
    1,586
    Likes Received:
    1,947
    Trophy Points:
    113
    Location:
    NSW
    I agree with the 2 answers above.
     
    John s likes this.
  5. John s

    John s New Member

    Joined:
    Jul 28, 2020
    Messages:
    21
    Likes Received:
    18
    Trophy Points:
    3
    I
    Informative, thanks very much.
     
    mmm....shiney! likes this.
  6. Ag bullet

    Ag bullet Well-Known Member

    Joined:
    Dec 27, 2013
    Messages:
    1,582
    Likes Received:
    1,570
    Trophy Points:
    113
    Location:
    SE QLD
    ATO

    Avoid
    Tax
    Often
     
    silverhair, slavaja and John s like this.
  7. John s

    John s New Member

    Joined:
    Jul 28, 2020
    Messages:
    21
    Likes Received:
    18
    Trophy Points:
    3
     
  8. Tin Can

    Tin Can Active Member

    Joined:
    Mar 30, 2019
    Messages:
    128
    Likes Received:
    53
    Trophy Points:
    28
    I recall reading on the ATO website that if an item cost less than $500 to acquire, GCT does not apply if you sell it.
    Or it might be only if the sale price is less than $500?
     
  9. wrcmad

    wrcmad Well-Known Member Silver Stacker

    Joined:
    Jan 2, 2012
    Messages:
    6,644
    Likes Received:
    1,502
    Trophy Points:
    113
    Location:
    Northern NSW
    lizzyno.jpg
     
    John s and Ag bullet like this.
  10. Ag bullet

    Ag bullet Well-Known Member

    Joined:
    Dec 27, 2013
    Messages:
    1,582
    Likes Received:
    1,570
    Trophy Points:
    113
    Location:
    SE QLD
    what about capital loss refund? or are they only interested in collecting money?
     
    John s likes this.
  11. wrcmad

    wrcmad Well-Known Member Silver Stacker

    Joined:
    Jan 2, 2012
    Messages:
    6,644
    Likes Received:
    1,502
    Trophy Points:
    113
    Location:
    Northern NSW
    Does anyone really take a loss on metals?
    Honestly, they are the fkn grandpa-level boring investment, but everyone seems to hold so long they never seem to take a loss?
     
    John s likes this.
  12. SilverDJ

    SilverDJ Well-Known Member

    Joined:
    Nov 1, 2014
    Messages:
    3,935
    Likes Received:
    1,297
    Trophy Points:
    113
    Location:
    Australia
    You cannot take a capital loss as a refund, nor offset it against regular income. But it does carry over indefinitely. So if you last capital loss was 20 years ago, and you only just made a capital gain, you can offset that loss from 20 years ago.
     

Share This Page