Anybody know about the tax implications of income/losses derived from short selling shares? I'm not a share trader, just a share holder. ATO aren't much help. Is income derived from a short sale profit classified as income, or a capital gain? Likewise, is a loss, which is a direct result of a short sale trade offsettable against a capital gain, or a deduction from one's income? As mentioned I am not a share trader, for tax purposes, simply a share holder.