Problem
Jordan Lama, a 54-year-old construction worker, came with the following information, looking for your insights to calculate his net tax payable liability. He has made a list of all capital assets sold during the year and relevant costs he is considering claiming in his tax return.
A three-bedroom investment property was purchased in 2015 and made available for rent. He paid $150,000 for the property and incurred other costs of $70,000. In January 2021, he sold the property for $300,000.
1000 units of shares sold in May 2021 for $5500. These shares were purchased at $10 each for $1,000 in 2020. There are no brokerage costs on the sale of the shares.
A capital loss carried forward from the previous year is $10,000
Task
1. Critically analyse the capital gain tax raised from the above situation and provide a detailed analysis showing the total calculations and explanation of any gain or loss that the taxpayer has incurred from the transactions.
2. Assume the taxpayer also lost $6000 from selling a collectible (CGT asset). How would this CGT event change his tax liability?