Commonwealth Consolidated Acts Commonwealth Consolidated Acts(1) A * capital gain or * capital loss you make from a * CGT asset is disregarded if, at the time of the * CGT event, the asset is:
(a) your * trading stock; or
(b) if you are a partner, trading stock of the partnership; or
(c) if you are absolutely entitled to the asset as against the trustee of a trust (disregarding any legal disability), trading stock of the trustee.
(2) A * capital gain or * capital loss you make in these circumstances is disregarded:
(a) you start holding as * trading stock a * CGT asset you already own but do not hold as trading stock; and
(b) you elect under paragraph 70 - 30(1)(a) to be treated as having sold the asset for its cost (worked out under that section).
Note 1: Paragraph 70 - 30(1)(a) allows you to elect the cost of the asset, or its market value, just before it became trading stock.
Note 2: You may make a capital gain or loss if you elect its market value: see CGT event K4.