I have shares in 2 Australian stocks that I am thinking of selling (at least partially). I am an Australian resident for tax purposes. Let's call these stocks;
- Stock ABC
- Stock DEF
I have owned stock ABC for over 1 year and have collected dividends. I also purchased these shares with the intention of obtaining an income, so on that basis I will claim the CGT discount of 50% when I sell these shares.
Stock ABC has appreciated substantially since I purchased it, and I am facing a substantial tax burden on its sale. The stock is now, in my view, overvalued so I want to sell it.
For the sake of illustration let's say I will make a gain of $25,000 when I sell my ABC shares. I also hold shares in DEF, which was a speculative purchase in a stock that was never likely to yield me any dividends, and as such I would not claim the CGT discount on its sale (even had I made a profit). Having said that, I have owned DEF shares for more than 1 year as well. Let's say I stand to realise $5,000 in capital losses upon selling at the current trading price.
My question is; can I claim a full $5,000 deduction against my $12,500 discounted capital gains, or can I only deduct $2,500?