- Switzer Report - https://switzersuperreport.com.au -

Cleaning up your portfolio before June 30

With only this week remaining in the financial year, investors should be finalising their tax strategy, which includes capital gains tax (CGT) considerations. It’s time for a review of the portfolio, to reduce CGT by selling any non-performing shares that you may be holding. Selling such a stock gives rise to a tax loss that can potentially be handy, if it’s used to offset a capital gain on another share.

Nobody likes making a capital loss on a stock, but the pain can be assuaged by using the loss to soak up a capital gain that you have – hopefully – earned elsewhere. Use the annoying situation of a loss to reduce the ATO’s take of your capital gains.

The most efficient way to do this is to be on top of your ‘parcels’ of shares: to know exactly when you bought various parcels of your shareholding, so you can use the CGT discount for shares held for more than 12 months.