![]() Jamie acquired 100 units in the Westfield America Trust (WFA) in January 2003. However, there may be other aspects of the whole restructure arrangement which will result in CGT consequences for you.Įxample 43: CGT consequences associated with the stapling of securities The stapling does not result in any CGT consequences for you, because the individual securities are always treated as separate securities. The way you work out the cost base and reduced cost base of each security depends on the terms of the stapling arrangement. If you acquired your stapled securities as part of a corporate restructure you will, during the restructure, have owned individual securities that were not stapled. The first element of the cost base and reduced cost base of each of Cathy’s units in JKL Unit Trust will be $1.60 ($4.00 × 40%). On this basis, the first element of the cost base and reduced cost base of each of Cathy’s shares in JKL Ltd will be $2.40 ($4.00 × 60%). She paid $4.00 for each stapled security, and on the basis of the information provided to her by the issuer of the stapled securities, she determined that 60% of the amount paid was attributable to the value of the share and 40% to the value of the unit. On 1 September 2002, Cathy acquired 100 JKL stapled securities, which comprised a share in JKL Ltd and a unit in the JKL Unit Trust. ![]() The issuer of the stapled security may provide assistance in determining these amounts.Įxample 42: Apportionment of cost base and reduced cost base to the separate securities ![]() One reasonable basis of apportionment is to have regard to the portion of the value of the stapled security that each security represented. If you acquired the securities after they were stapled (for example, you bought the stapled securities on the ASX), you do this by apportioning, on a reasonable basis, the amount you paid to acquire the stapled security (and any other relevant costs) between the various securities that are stapled. work out any capital gain or capital loss separately for the unit and the share.īecause each security that makes up your stapled security is a separate CGT asset, you must work out a cost base and reduced cost base for each separately.continue to include separately on your tax return dividends from the company and trust distributions from the trust.For example, if a share in a company and a unit in a unit trust are stapled, you: However, in general, the effect of stapling is that each individual security retains its character and there is no variation to the rights or obligations attaching to the individual securities.Īlthough a stapled security must be dealt with as a whole, the individual securities that are stapled are treated separately for tax purposes. The issuer of the stapled security will be able to provide you with detailed information on their particular stapling arrangement. ![]() The effect of stapling depends on the specific terms of the stapling arrangement. For example, many property trusts have their units stapled to the shares of companies with which they are closely associated. Many different types of securities can be stapled together. Stapled securities are created when two or more different securities are legally bound together so that they cannot be sold separately. ![]()
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