There are a number of methods that can be utilised to determine the 'matching' of investment parcels when a particular holding is sold including:
- First In First Out (FIFO)
- Last In Last Out (LIFO)
- Maximise Taxable Gain (or Minimise Taxable Loss)
- Minimise Taxable Gain (or Maximise Taxable Loss)
By default Superfund Wholesale will use the Minimise Taxable Gain method when it comes to matching specific parcels of investments.
What does this mean?
When units in an investment are sold, and there are multiple parcels of holdings (purchased at different times for different amounts for example), we will automatically match the disposed units to unit holdings in such a way that either the capital gain will be minimised or the capital loss will be maximised.
To put it another way: We (or rather our accounting software) will specifically identify the holdings to be disposed of which will result in the lowest capital gains / CGT.
Can we nominate a different method?
Yes. If you would like nominate a different method or nominate a specific parcel of units to be disposed of, you can notify us on a individual transaction basis or change the default for a specific SMSF / entity.
To identify the specific units we have recorded in the clients investment register, login to Client View browse to the Reports tab and access either the Unrealised Capital Gains report or Realised Capital Gains report:
To notify our team, please email email@example.com with the following details:
- Date of disposal transaction
- Number of units
- Details of the specific parcel or parcels of units you would like to dispose of
- What you have calculated as the resulting capital gain / loss
It is also possible to override the default parcel matching treatment at an SMSF / entity level if you would like to modify multiple transactions across a financial year or a longer period of time.
Please note that this method applies from 10/10/2016. Any SMSF accounts finalised prior to this date may have used the FIFO parcel matching method.