Can the capital loss be adjusted against ordinary income or only against capital gains? In many countries, you can't adjust a capital loss against ordinary income (including my home country).
If you cannot adjust capital losses against ordinary income then you're not really better off. Because you have to pay capital gains tax on any gains made in Australia, so you adjust losses against those but in Hong Kong, if you made a capital gain, there was no tax anyway so there is no need to adjust losses against gains.
Last edited by shree711; 10-01-2023 at 02:34 PM.
Promises, promises.
Can't remember where I originally read this, but if just about everyone else is being a dick to you... the real dick is probably in the mirror.
You can't take the abraisiveness which you constantly dish out to others and, and hide behind terms like 'self expression' and 'circle jerk' when the real issue is your constant need to put others down causes them to do the same to yourself.
Actually you might be right, I need to hire an accountant to figure it out
But just to clarify, I will make a gain on my HK property, but on paper for tax purposes I will make a loss. This is because I bought my property in 2009 for HK$6m. But I became Australian tax resident in Jan 2020 and on this date the theoretical paper value of the property is HK$14m. So then if I sell it for $13m in 2023, I make a real gain of HK$7m in my pocket, but for Australian tax purposes I make a capital loss of $1m. The key point is that I moved to Aus on a date when the property value just happened to be high.
I tend to take tax matters quite seriously. I understand what you mean, your effective date of Australian acquisition is the price of the asset when you become an Australian tax resident. So that's the base value and then the sale value after that will be a gain or a loss on the base value. In this case, you say it is a loss.
However, upon a cursory look at Australian laws and application of basic logic regarding the principle of capital gains and capital losses from other countries as well, it appears to me that a capital loss cannot be adjusted against ordinary income and therefore, you're not really benefitting here. The only good thing for you is that if you make Australian capital gains (from other real estate or shares), you can claim a capital loss against those gains. But those gains have to be made first and you could have made those gains in other places too. In the meantime, you will owe regular Australian taxes on your ordinary income which you would have paid less tax on in HK. Living standards might be better and expenses might be lower in Australia though but you did say that you're worse of financially in Australia after taxes.
Just trying to make the situation clear here.
Oh overall is clear, I moved to Aus and I accept I pay higher taxes and take home less monthly than I did in HK because of this. But I have a higher standard of living, wife and kids are happier, the higher taxes I pay are returned to me in things such as free education, there are a million ways to reduce taxes here such as sacrificing into superannuation which will give me a better retirement, etc.
Walked into Gateway Supermarket in Central to do some shopping for our kids and looks like they'll be "leaving HK" end of February. Anyone have some good recommendations on places to buy Lucky Charms and Pop Tarts?