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Dear Julia
In 2008, my husband and I bought shares in a publicly listed company. The shares remained in my name even though they were a joint asset.
After my marriage ended in 2013, I sold the shares and deposited all of the proceeds into an online savings account in my name that contained our joint savings. The capital gain was approx. $15,000.
We did not own a home, and agreed that there would be no division of superannuation or other assets. Thus, the content of the savings account (including the capital gain from the shares) was the only asset to be divided up between us.
We have lodged consent orders regarding a financial agreement, and anticipate that this will be finalised within the next few weeks. The consent orders note that the shares were disposed of, but do not address the issue of CGT.
On paper, the overall division of assets is 80% / 20% in my favour, however this takes into account our superannuation and other assets (which are not being divided). In relation to the contents of the savings account, the split is 70% / 30% in my favour.
QUESTION
Am I liable for 100% of the CGT associated with the disposal of the shares? Or, as the capital gain is part of an asset pool that is to be divided between myself and my ex-husband, is the CGT liability also divided? If this is the case, what formula should be used?
Answer
You are liable for 100% of the CGT associated with the disposal of the shares, you were the owner when they were sold. It is simply cash that you have contributed to that savings account/asset pool. Nevertheless this liability should be considered with dividing up the assets as it was a liability incurred before settlement.
Just to clarify you are still of course entitled to the 50% CGT discount.
