Report to locate Unrealized Gains

[DaveC49]

John, 

With regard to your side issue over the inability to deduct the commissions
and fees from the capital gains, I suspect it is because those fees and
commissions are already going to be deductable against your income as they
are generally a part of the expenses of running a share trading business. 

If they were also deductible against the capital gain income specifically,
it would amount to a double deductibility of the same expenses and most
taxation law has as a general principle that multiple taxation (and
deductibility) of the same amount should not occur.

Unless the fees and commissions on share trades are specifically not
deductible against your general income under the laws in your jurisdiction,
then this is likely to be the case. The alternative could arise where a
capital gains tax is a separate tax from income tax and may be taxed at
different rates. In this case one could envisage they would be specifically
deductible against the capital gains income and not be deductible against
general income for income tax.

For example, in Australia, our capital gains income is calculated as a
component of our taxable and is taxed at the same rates as company tax for
companies and the marginal tax rate for individuals and generally the fees
and commissions are deductible, i.e. it is not a separate tax. Their are
some exclusions for personal assets (home, car, furniture etc) and
depreciable assets for businesses.

>From what I understand of CGT in the US (limited to Wikipedia), capital
gains income is not taxed at the same rate as ordinary income and an
additional tax component applies above specified income thresholds, the
additional tax rate also depending upon the length of time the asset has
been held.

David Cousens



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