Hi all, new to these forums, and really couldn't find anywhere else to pose this question.
I'm just doing my Tax return for 2007/08 and am going to have to pay money for a change. My question relates to my managed fund.
(not real figures)
At the beginning of 2007/08 FY, the value of my managed fund was $21000. In 2007/08, I invested $3000 into the fund, and by the end of 2007/08 FY, the value of my managed fund is $20500. ie, I effectively lost $3500 last FY.
However, when I am entering data into etax, it comes up with the following figures:
Non-primary production income: $500
Franking Credits: $100
Net Capital Gains: $600
Total current year capital gains: $1200
Assessable foreign source income: $400
Other net foreign source income: $400
And when I get to the Tax estimate screen I get:
Partnerships and Trusts $100 (the Franking Credits figure)
Partnerships and Trusts $500 (the Non-primary production income figure)
Capital Gains $600 (the Net Capital Gains figure)
Foreign source income and foreign assets or property $400 (the foreign figure)
So it appears, that even though I made a $3500 loss on the managed funds over the year, my Income is being increased by $1500 from the managed funds! (less the $100 in credits I get).
When talking to friends they thought I should get a Capital Loss for the year, as I've lost money. However I guess that only would've worked had I sold out of the Fund?
I'm only guessing here, but the only way I can understand these figures is that the fund manager sold stocks that did make a profit over the year (hence the Positive Capital Gain), and held on to stocks that made a loss (so there was no Negative Capital Gain, as nothing was sold???).
Can anyone shed light on the matter? Does it make sense that I'm paying extra in tax for a managed fund that lost me money?