General Exemption Details
In addition to the general exclusion from capital gains tax of assets purchased before 20 September, 1985, there are specific exemptions under the CGT provisions. The most significant of these is the exemption of a taxpayer's principal residence. Partial exemptions apply where the property is used for income-producing purposes for part of its life and as the taxpayer's residence or holiday residence for part of the time.
Other exemptions include gambling wins, certain awards, disposals under cultural bequests, etc.
| Field | Description |
|---|---|
| Details | This refers to a description of the reason for seeking the exemption. Standard answers can be created in AE and Series 6 & 8 for details of all kinds. Click [F7] to select from the index of Standard answers, otherwise type the details. |
| Exempt From | This refers to the start date of the period of exemption. This date must be within the life of the asset; that is between the date of acquisition and the date of disposal. |
| Exempt To | This refers to the end date of the period of exemption. This date must be a date later than the From date and any date up to the date of disposal. If a date is not entered, Tax will default the current year end date. |
| Exempt Proportion | This field is not available for entry if dates have been entered. To use a calculated proportion rather than dates, enter the known proportion at this field. |
| Code | Select from the list available the code for the type of exemption. |
The code you select must be appropriate for the type of tax return being prepared. For example, if when preparing a Company return you select Code I - Main Residence exemption, the error message ‘Code not valid for this form type’ will be generated.
OK: When details have been entered and you click OK, the net capital gain for the asset will be reduced by EITHER:
the number of days in the exemption period as a proportion of the total number of days from the date of acquisition to date of disposal multiplied by capital gain, OR
the capital gain calculated multiplied by the exempt proportion.
The reduced amount is the amount which will be included at the Capital Gains label in the appropriate return.