ATO issues capital gains guidance for companies, trusts and individuals
The Australian Taxation Office (ATO) has reminded businesses they can claim a tax deduction on their 2023-24 lodgement if they recorded capital losses in previous financial years.
“A company can deduct previous net capital losses from capital gains in [2023-24] as long as it is either substantially under the same ownership and control [or] still in the same line of business,” according to the ATO.
But if you had a trust that recorded a capital loss in 2023-24, these losses cannot be distributed to the trust’s beneficiaries. “The trust can carry forward its net capital losses and deduct them from capital gains in future years,” the ATO added.
On a personal note, individuals can reduce any capital gains they made in 2023-24 by offsetting them with capital losses from this year or previous years. “However, you need to use the losses you’ve carried forward from previous years first. If these losses reduce your current year gains to zero, you can carry over any remaining losses to offset future gains for as long as you need,” according to the ATO.
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