The Adjustments tab is where you enter any cost base adjustments for the open parcels held at the load date. You can choose from the following six types of cost base adjustments.
This tab is applicable for all Entities.
|Cost base adjustment type
|Tax Deferred adjustment
|Adjust the investment cost base downward for tax purpose only.
|First Element adjustment
|Adjust the investment cost base upward and downward for both accounting and taxation purpose.
|Adjust the investment cost base upward and downward for tax purpose only. It is only relevant if the investment has adopted the Attribution Managed Investment Trusts (AMIT) Scheme.
|CGT Notional Deferred Gain
|Record the CGT notional deferred gain for a parcel that has participated the transitional CGT relief in 2016/17FY.
|CGT Relief Cost Base Adjustment
|Record the difference between accounting cost base and tax cost base for an investment that has applied the transitional CGT relief in 2016/17FY. Please note that if you have recorded the tax cost base as the acquisition cost of the investment, do not use this cost base adjustment type.
|Tax Free adjustment
|Reduce the capital loss amount where applicable.
Note: CGT Notional Deferred Gain and CGT Relief Cost Base Adjustment only applies to SMSF
Note: Adjustments cannot be processed for Custom Holding Accounts
How to record CGT Notional Deferred Gain & CGT Relief Cost Base Adjustment
Scenario: A parcel of 1,200 units of SCP shares was acquired on 1/6/2016 with original book cost of $20,000. The share has undergone CGT relief on 30/6/2017 with a market value of $34,464 as at 30 June 2017. As a result of the CGT relief, the CGT date was reset to 30/6/2017 and the CGT cost base was uplifted to $34,464. The notional deferred gain amount is $1,928.53 on net basis, i.e. after the 1/3 discount and ECPI exemption.
Please find below information to be recorded in the loader to transition the fund onto Class with book closed date of 30/6/2017.
Step 1: Record the acquisition details on the Acquisition tab as follows:
Step 2: Record the CGT relief information on the Adjustments tab. The notional deferred gain amount of $1,928.53 is to be recorded using the CGTNotionalDeferredGain adjustment type. To reflect the relect the tax cost base, work out the difference between the tax cost and accounting cost, i.e. $14,464 = $34,464 - $20,000. Record $14,464 using the CGTReliefCostBaseAdjustment adjustment type.
This is how it will look like on the Holding Balances tab. The implied tax cost base is therefore $20,000 + $14,464 = $34,464.
Enter in your historical TBAR records.