For updates affecting this Division please see Part C0 Updates
Allowable expenditure for capital gains
C2.201 Allowable expenditure for capital gains—overview
Broadly, where an asset is subject to disposal and the proceeds received or deemed to be received exceed the allowable costs, the profit is taxable. This profit is known as a capital gain. Where the proceeds are less than the allowable costs, a loss rises that may be relieved against the person's gains.
For an overview of capital gains, see C1.101. For an overview of the computation of gains and losses, see C1.105.
The commentary below summarises the issues to be considered in relation to allowable expenditure for capital gains.
Allowable expenditure
No formula is prescribed by legislation for the computation of capital gains or allowable capital losses and it is implicit that these gains or losses are computed as the difference between the consideration received for disposal (see Division C2.1)
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