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5 ways to take control at tax time with Sharesight

By SharesightAugust 17, 2023August 22nd, 2023No Comments

Experienced investors have told us that tax time can be taxing. Doing your tax return is not the most enjoyable part of investing – it’s tedious at best. 

Whether you prefer to do your tax independently or with the help of an accountant, there are lots of ways you can save time and money during tax season. 

Here are 5 from Sharesight – a leading portfolio tracker and reporting tool for Australian investors:

          1. Specify the CGT rules that meet your needs

It’s difficult to calculate CGT when there are so many ways you can slip up. Should you use FIFO or LIFO? Minimise or maximise? Sharesight’s Australian capital gains tax report calculates capital gains made on shares according to the Australian Tax Office rules. 

You can specify different sale allocation methods across your entire portfolio and for your individual holdings, including:

  • First In, First Out (FIFO) – Sharesight assumes that you sell your longest held shares first.
  • Last In, First Out (LIFO) – Sharesight assumes that you sell your most recently purchased shares first.
  • Minimise Gain – Sharesight assumes that you sell shares with the highest purchase price first.
  • Maximise Gain – Sharesight assumes that you sell shares with the lowest purchase price first.
  • Minimise CGT – Sharesight assumes that you sell shares that will result in the lowest capital gains tax first. This method is more sophisticated than the ‘Minimise capital gain’ method because it takes into account the Australian CGT discounting rules.

         2. Break down your dividends

Sharesight’s taxable income report is also very helpful at tax time as it provides a record of all your dividends over any time period, broken down into their various tax components and organised by local or overseas income.

To make it easier to file your tax return, the taxable income report:

  • Provides field references to the relevant sections on the Australian Income Tax Return for Individuals and Income Tax Return for Individuals (supplementary section) 
  • Provides totals required for the Income Tax Return based on non-trust and trust income.
  • Breaks down dividend payments into their relevant tax components, such as franked/unfranked amounts, franking credits, foreign income tax, TFN withholding tax and exchange rates.

         3. Sharing can be caring

No more shoe-boxes full of paperwork for your accountant to sort through. Another essential tax time feature is the ability to share your portfolio. 

With Sharesight, rather than printing out and forwarding your tax reports, you can securely share portfolio access directly with your accountant and/or financial adviser. 

With all your portfolio data in one place, they’ll have everything they need to prepare your tax documents. 

        4. Make sure your different residencies are taken care of

Do you have multiple portfolios with different tax residencies? If so, that makes tax time even tougher. 

Depending on the country chosen, Sharesight can determine their portfolio currency and functionality relating to the tax requirements of the chosen country. This includes reports for tax purposes and country specific data input requirements.

For example, setting the country to “Australia”, Australian investors have a choice of portfolio tax settings relating to Australian Taxation Office (ATO) tax entities. 

         5. Decide whether a tax loss selling strategy works for you 

Towards the end of the financial year, it is a time to think about any potential losses incurred during the year. A tax loss selling strategy can help you offset your gains before the end of the tax year. To determine if this strategy is right for you, you can use Sharesight’s unrealised CGT report which:

  • Displays the CGT position for all your holdings which are not yet sold.
  • Breaks up the CGT gains into short and long-term, and shows your losses as well.
  • Allows you to specify the sale allocation method at the overall portfolio and individual holding level to determine your optimal position.
  • Models the taxable income that would arise if the shares were sold on the report date.

About Sharesight

Bell Direct is proud to partner with Sharesight to help enable investors to take control at tax time. It’s just another way we help investors find their investing edge. 

Sharesight is a leading online share portfolio tracker & reporting tool for Australian investors. Sharesight tracks share prices, trades, dividends, performance & tax, trusted by more than 400,000 investors globally. Find out why it is better than a spreadsheet here.

This information is general in nature and does not take into account your financial situation, objectives or needs. You should consider whether it is appropriate for you. You should read our Financial Services Guide and any relevant Product Disclosure Statements before making an investment. For more information visit belldirect.com.au or call 1300 786 199. Bell Direct is the trading name of Third Party Platform Pty Ltd ABN 74 121 227 905, AFSL 314341.