Is There a Capital Gain or Capital Loss?

Once you have determined the disposal is subject to the capital gains tax provisions, you need to work out if you made a gain or a loss.

Capital Gains

Capital gains occur when you receive more money for something than you paid for it. The net capital gain is added to your taxable income and taxed at your marginal rate. For more on this, see calculating capital gains.

Capital Losses

Capital losses are not deductible against your ordinary taxable income. But they are used to reduce any other capital gains you make in the year, or any gains in subsequent years. You can carry forward capital gains indefinitely, but you must apply them to gains when they arise (i.e. you cannot decide which year you want to use them).