1. What is the Cost Basis Calculation?

The cost basis calculation determines the adjusted basis of an asset for Australian tax purposes. It includes the original acquisition cost plus any incidental costs, minus any capital returns received.

2. How Does the Calculator Work?

The calculator uses the cost basis formula:

Where:

• Acquisition Cost — The original purchase price of the asset (AUD)
• Incidental Costs — Additional costs related to acquiring or selling the asset (AUD)
• Capital Returns — Any returns of capital received (AUD)

Explanation: This calculation helps determine the correct cost base for capital gains tax purposes in Australia.

3. Importance of Cost Basis Calculation

Details: Accurate cost basis calculation is crucial for determining capital gains or losses when disposing of an asset, which affects your Australian tax liability.

4. Using the Calculator

Tips: Enter all amounts in AUD. Include all relevant costs and returns. All values must be non-negative numbers.

5. Frequently Asked Questions (FAQ)

Q1: What counts as incidental costs?
A: Incidental costs include legal fees, stamp duty, valuation fees, and other costs directly related to acquiring or selling the asset.

Q2: What are capital returns?
A: Capital returns are amounts returned to you that reduce your original investment in the asset.

Q3: Is this calculator specific to Australia?
A: Yes, this calculator follows Australian tax rules for cost basis calculation.

Q4: How does this affect capital gains tax?
A: The adjusted basis is subtracted from the sale price to determine your capital gain or loss.

Q5: Should I include GST in the amounts?
A: Generally, you should include GST in the amounts if you couldn't claim it as a credit.