Capital Gains Tax Calculator

Selling an Australian investment — shares, crypto or a rental property — triggers capital gains tax (CGT) on the profit. This calculator works through the full ATO method: it builds your cost base, applies any carried-forward capital losses, applies the 50% discount if you held the asset more than 12 months, and then estimates the actual tax by adding the taxable gain to your other income and running the resident tax scale — because in Australia the gain is taxed at your marginal rates, not a flat CGT rate.

How It Works

1. Cost base. Purchase price plus purchase costs, selling costs and capital improvements — all four reduce your gain.
2. Gross gain. Sale price minus cost base. If this is zero or negative, the result is a capital loss: no tax, no discount, and the loss is reported for carry-forward.
3. Losses first. Any carried-forward capital losses you enter are subtracted from the gross gain before the discount is considered.
4. The 50% discount. If you held the asset more than 12 months, half of the remaining gain is discounted away; the other half is your taxable gain.
5. Tax by difference. The tool calculates tax on your taxable income without the gain, then with the taxable gain added, using the Australian resident scale stored in the tool (tax-free threshold $18,200; then 16$26,000. The difference between the two figures is your estimated CGT — and it also reports how much the discount saved you by running the same difference without it.

The Formulas

$\text{Cost Base} = \text{Purchase Price} + \text{Purchase Costs} + \text{Selling Costs} + \text{Improvements}$

$\text{Taxable Gain} = \bigl(\text{Sale Price} - \text{Cost Base} - \text{Losses Used}\bigr) \times (1 - \text{Discount})$

$\text{Estimated Tax} = \text{Tax}(\text{Income} + \text{Taxable Gain}) - \text{Tax}(\text{Income})$

Input Parameters

| Parameter | Unit | Description | |---|---|---| | Purchase Price | Currency (AUD) | What you originally paid for the asset. | | Sale Price | Currency (AUD) | Total proceeds from the sale. | | Purchase Costs | Currency | Stamp duty, brokerage, legal fees on acquisition. | | Selling Costs | Currency | Agent commissions, brokerage, legal fees on disposal. | | Capital Improvements | Currency | Capital spending that increases the asset's value. | | Carried-Forward Losses | Currency | Prior capital losses available to offset this gain. | | Taxable Income | Currency (AUD) | Your other taxable income for the year, before this gain. | | Held Over 12 Months | Yes / No | Qualifies the gain for the 50% discount. | | Main Residence | Yes / No | Flags the main residence exemption warning described below. |

Worked Example

You sell an investment for $80,000. You bought it for$50,000, paid $500 in purchase costs and$500 in selling costs, and spent $4,000 on capital improvements. You have$2,000 of carried-forward losses, other taxable income of $90,000, and you held the asset for over 12 months.

• Cost base: $50,000 +$500 + $500 +$4,000 = $55,000**. Gross gain:$80,000 − $55,000 = **$25,000.
• Losses applied: $25,000 −$2,000 = $23,000**. Discount (50$11,500. Taxable gain: $11,500.
• Tax on $90,000 alone (scale plus Medicare):$19,588. Tax on $101,500:$23,268. Estimated CGT: $3,680.
• Without the discount the bill would be $7,360 — the discount saved exactly **$3,680** here, because the whole gain sits inside the 30% bracket plus Medicare.
• Net profit after tax: $25,000 −$3,680 = $21,320, an effective tax rate of 14.72% on the gross gain.

The effective rate is the insight most sellers miss: a "50% discount" does not mean a 50% tax cut in every case, and the bill depends on which brackets the gain spans — a large gain can push part of itself into the 37% or 45% brackets even after discounting.

Interpreting the Results

• Discount tax saving isolates the value of the 12-month rule for your numbers. Timing a sale to cross the 12-month mark is often the single largest tax lever an individual investor controls.
• Effective tax rate (tax divided by the gross gain) lets you compare across sales and income years; it is always below your top marginal rate when the discount applies.
• Losses used confirms how much of your carried-forward balance this sale consumed; any remainder stays available for future gains.

Losses, and the Main Residence Flag

A capital loss cannot reduce your salary or other income — it only ever offsets capital gains, in the year of the sale or carried forward indefinitely. If you flag the asset as your main residence, the calculator warns you that the main residence exemption usually makes the gain fully exempt in reality: the tool still runs the numbers for illustration, but do not rely on them for your home.

Limitations

• Individual residents only. The scale used is the Australian resident individual scale. Companies receive no CGT discount, SMSFs receive a one-third discount, and foreign residents are generally excluded from the discount — none of those cases is modeled.
• Simplified cost base. Ownership costs, capital works deductions, reduced cost base rules and partial main-residence use are outside the model. Property calculations in particular can involve adjustments this tool does not attempt.
• Medicare levy is the flat 2% once income passes the tool's threshold; levy shade-in ranges and surcharges are not modeled, and the tax scale is the one stored in the tool rather than a future indexed version.

Frequently Asked Questions

Is CGT a separate tax in Australia?

No. Your net capital gain is added to your other taxable income and taxed at your marginal rates for the year. That is why this calculator asks for your taxable income and computes the tax as a difference, rather than multiplying the gain by a single rate.

Why are losses applied before the discount?

That is the ATO's required order, and it is built into the tool: losses reduce the gross gain first, and the 50% discount then applies to what remains. It means a dollar of loss saves you less tax than a dollar of gain costs when the discount applies.

What if I held the asset for less than 12 months?

No discount: the entire gain after losses is taxable. In the worked example, skipping the discount doubles the estimated tax from $3,680 to$7,360 — the clearest illustration of why the holding period matters.