Capitol Gains Tax On Coins In Australia

The ATO connot form a view, if they haven't got anything on which they can form a view.
If I buy a coin for less than $500 and don't have the paperwork, then sell it for more than $500 through an auction, the CGT paper trail starts from that sale.

Or I could give the coin to one of my kids.

enworb, nice job. I will trade this way when I sell my coins

But if you're making lots of money selling coins, you should want to pay capital gains tax; the whole point of capital gains tax is that it is a tax dodge (or tax relief, depending on your point of view) for those people who make their living buying and re-selling "assets" - people like coin dealers, bullion dealers and antique dealers. For the people prepared to put the "work" into it (keeping meticulous records until Doomsday, etc), they pay less tax on their sale of assets than the people who don't, because the people who don't are (supposed to) pay tax on 100% of the income they derived from the sale, not just the piece of the income that qualifies as "capital gain". If anyone fails to declare money received from sale of coins as either income or CGT, well, they're the ones that have perjured themselves on their tax form.

CGT is payable on gifts of over $500, and payable from the date of receipt of the gift.
So I give my kids gifts of well less than $500, usually something in the $100 to $400 range. Almost all of my coins are valued at VERY much less than $500, and the average value per coin in my collection would be around $20. That includes the most valuable coins averaged into that calculation.

What I can't give away, but I can share, is my love for numismatics.
And CGT is not payable on that.

There are a few ways around CGT, for example I intend to move overseas for a few years when I retire (so I'll no longer be an Australian resident for tax purposes). At that stage I will get my coins valued at the maximum possible (why say your collection is worth $100,000 when you can get it valued at $200,000 using overpriced book values and lax grading). That $200,000 valuation is then used as the cost base for GST. Just keep within justifiable pricing and the tax man will be unlikely to challenge it (I can say a gF 1930 penny that might get $20000 at auction is aVF and worth $45000 according to the catalogues and they would find that hard to challenge but if I say a VG 1964 penny is worth $45000 then I deserve to get busted).
If you then say sell the '23 halfpenny at $7500 when it has a GST valuation of $15000 you can then use the nominal "loss" to offset capital gains elsewhere (such as on shares). Even if you have no shares you can still work the system (I could give the coins that I want to sell to my kids and they can sell the coins and book a loss to offset against their shares).

Cally,

Some great questions!

I am not sure about the "intent" issue in the first two questions and how the Tax Office would treat it.

However, the answer to the third question is definitive for collectables.

From the ATO website:

"Capital losses from collectables can be used only to reduce capital gains (including future capital gains) from collectables. As is the case with any capital loss, there is no time limit on how long you can carry forward a net capital loss from a collectible."

As with share losses, you can choose when to use your carried over capital losses to maximise your tax advantages.

Cheers

Peter (notcb)

Cally

with Robster , have loaded up the truck to move to ......

(Hills that is ).