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CGT: consideration and cost base paper


Calculation of consideration and cost base for CGT purposes can be made complicated by post completion and other events. The impact of different events is examined in this paper including:

  • is the cost base fixed by the requirement to pay under the contract or can it change? For example, cost base adjustments for post-completion events
  • how is cost base affected by set-off or forgiveness of liability to pay?
  • CGT treatment of contingent and unascertainable amounts (eg earn-outs) for both consideration and cost base purposes
  • is consideration under a contract ever fixed? What if there is known exposure to a warranty claim when the contract is signed?
  • are legal costs related to opposing an indemnity claim part of the seller’s cost base?

Author profiles

Sue Williamson CTA-Life
Sue leads EY's Melbourne Tax Controversy practice. She has acted in various AAT, Federal Court, High Court and Supreme Court cases relating to various Commonwealth and state taxes, and has advised clients on a broad range of taxation issues including income tax, GST and PRRT. Sue is also an accredited mediator and has assisted clients in resolving disputes using various alternative dispute resolution mechanisms. Sue is a member of the ATO Dispute Resolution Committee and is a former president of The Tax Institute. - Current at
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Melanie Baker CTA
Melanie is a Barrister who specialises in tax. Before joining the Victorian Bar, Melanie was a Senior Associate in the tax group of Allens Arthur Robinson. Before joining Allens in 2002, Melanie worked at the ATO in Canberra for two years. As a Barrister, Melanie regularly advises, and appears on behalf of, taxpayers and the Commissioner of Taxation. - Current at 07 October 2014
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This was presented at 46th Victorian State Convention: Feast of Delicacies .

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Individual sessions

Innovative capital raisings

Author(s):  Paul ABBEY

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Corporate distributions and capital management issues

Author(s):  Tim NEILSON

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The Commissioner's Role in Interpreting Tax Law and Emerging Issues for Advisers

Author(s):  Jennifer BATROUNEY

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Defending the trust ramparts

Author(s):  Graeme HALPERIN

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