Capital gains can be reduced by 50 per cent under the 50 percent discount rule. This means that where the asset is held by an individual or a trust for at least 12 months, excluding the date of purchase and sale, only 50 per cent of the capital gain is included as part of assessable income. Companies are not eligible for the 50 percent discount in respect of their capital gains.

You can use the discount method to calculate the amount of capital gain if:

 

Generally, the discount method does not apply to companies, although it can apply in relation to a limited number of capital gains made by life insurance companies.

In determining whether your client acquired the CGT asset at least 12 months before the CGT event, you exclude both the day of acquisition and the day of the CGT event.  Note that if your client:

…then you can use the discount method to work out the capital gain from the property.