BlogSharesight Features & Tips

Calculate your capital gains tax (without a spreadsheet or calculator)

by Angela Thompson, Sharesight
NOTE: There is a newer version of this article. See Capital gains tax calculator for Australian investors for more information.

Smash your calculator. Ditch the spreadsheet. The best way to calculate your investment portfolio’s CGT obligations is to use Sharesight’s Capital Gains Tax Report. Here’s why:

  • It takes care of the maths (so you don’t have to).
  • It makes it easy to optimise your tax position by letting you experiment with different sale allocation methods.
  • You can run the report at any time, over any time period. So not only will you have the information you need at tax time, but throughout the year. This means fewer surprises when the next tax season rolls around.

Our Australian Capital Gains Tax Report calculates capital gains made on shares as per Australian Tax Office rules (for those of you in Canada, we also offer a Canadian CGT Report). The report is based on the ‘discount method’ for shares that were held for more than one year and the ‘other method’ for shares held for less than one year (more on that below).

featured - calculator - smashed

How to calculate your CGT

1 – Sign-up for a Sharesight account

Join the tens of thousands of DIY investors already taking control of their portfolio with Sharesight. You can track up to 10 holdings for FREE!

2 – Import your holdings

You may add your holdings manually, by spreadsheet (CSV) or via a one-time connection to your online broker: screenshot - add holding

3 – Confirm your tax settings

Because Sharesight lets you track multiple portfolios (tax entities), you’ll want to confirm/update your portfolio’s discount rate before running the CGT Report. To do that, go to Settings > Tax Settings: screenshot - tax settings

4 – Run the Capital Gains Tax Report

From the Reports menu, select the Capital Gains Tax Report: screenshot - reports - cgt

5 – Select your date range

Enter a custom date range or select from a preset option, including the current or last financial year: screenshot - cgt report - date range

6 – Review your CGT report

The Capital Gains Tax Report breaks down:

  • Short Term Capital Gains (assets bought and sold within one year or less)
  • Long Term Capital Gains
  • Capital Losses

screenshot - cgt report It also includes a helpful summary: screenshot - cgt report - summary

7 – Set your prefered sale allocation method

You can experiment with different sale allocation methods in order to optimise your CGT position. Choose from:

  • FIFO (First In, First Out)
  • LIFO (Last In, First Out)
  • Maximise Gain
  • Minimise Gain
  • Minimise CGT

The “Minimise CGT” option is handy. We’ll assume that you sell shares resulting in the lowest capital gains tax first. This method is more sophisticated than the “Minimise Gain” method because it takes into account the discounting rules. Note that the sales allocation method can be changed for specific holdings or for the entire portfolio: screenshot - cgt report - sale allocation methods

8 – Carry forward your losses

You may also choose to carry forward any losses from the previous reporting period: screenshot - cgt report - carry-forward losses

9 – Lock it up

Once you’re happy with your report, you may choose to “lock” it. This allows you to alter the sale allocation methods in future reporting periods without invalidating the result for previous periods: screenshot - cgt report - lock

Want more?

  • Download your CGT report – As with all of Sharesight’s reports, your entire Capital Gains Tax Report can be downloaded to Excel, PDF or Google Sheets.
  • Take advantage of tax loss selling – The Unrealised CGT Report makes it easy to lower your capital gain tax obligations by letting you model the implications of tax loss selling (tax harvesting).
  • Share access with your accountant – With your capital gains and losses automatically sorted, you should save on accounting fees this tax season. Why not take it a step further by securely sharing your portfolio with your accountant? They’ll have everything they need at their fingertips – not just at tax-time but throughout the year.

Need help?

For more information visit our Capital Gains Tax Report help page.

Important Disclaimer: We do not provide tax advice. Make sure you seek appropriate tax advice before implementing the ideas in this post.