In Australia, when you sell or dispose of a precious metal such as gold bullion, you may be subject to Capital Gains Tax (CGT). This tax is based on the profit you make from the sale, and the rate is typically lower than your income tax rate.
The CGT rate for selling gold in Australia is 28%, but you only need to pay tax on 50% of the profit if you held the investment for longer than a year. To calculate your capital gain, deduct the purchase cost from the sale price. Investment-grade gold bullion does not attract Goods and Services Tax (GST). However, it is important to note that tax rules may change over time.
Similarly, selling jewelry can also be subject to CGT, and you will be taxed at the standard capital gains rate or a 28% general rate. To minimize your tax bill, you can avoid spending money on physical metals when prices are high, reinvest your money from the gold sale to buy more gold, or hold onto your gold for at least a year before selling.
When it comes to declaring gold to the Australian Taxation Office (ATO), it depends on the type of gold you hold and how you obtained it. If you hold gold bullion as an investment, you must calculate a capital gain or loss and declare it on your tax return. However, if you receive gold as a gift or earn it as a hobby, you may not need to declare it. Selling jewelry for a profit is also subject to tax, but it is important to remember that jewelry is not a reliable investment.