Australian Capital Gains Tax

Australian Capital Gains Tax (CGT) is a federal tax levied on the profit (capital gain) realized from the sale or disposal of an asset acquired after September 19, 1985. In finance, CGT impacts investment strategies and asset allocation, requiring consideration in portfolio optimization and return calculations. For engineering firms, CGT applies to the sale of assets like intellectual property or equipment. Calculation involves subtracting the asset's cost base (purchase price plus associated expenses) from the sale price. Various exemptions and discounts may apply, influencing the net taxable gain and subsequent tax liability.