CGT Event
A specific event that triggers a capital gains tax obligation, such as selling, gifting, or losing a CGT asset.
A CGT event is any event that triggers a capital gains tax consequence under Australian tax law. The most common CGT event is disposing of an asset — selling shares, property, cryptocurrency, or other investments. However, CGT events extend beyond sales to include gifts, lost or destroyed assets, creating a trust over an asset, a company cancelling shares, and ceasing to be an Australian resident.
There are over 50 different CGT events categorised from A to K in the tax legislation. The most common are: A1 (disposal of a CGT asset), C1 (loss or destruction of a CGT asset), C2 (cancellation, surrender, or similar ending of a CGT asset), D1 (creating contractual or other rights), E1–E9 (trust-related events), G1 (capital payment for shares), H2 (receipt of an asset outside a trust), and I1 (ceasing to be an Australian resident).
The timing of a CGT event determines which financial year the gain or loss falls into. For property, the CGT event typically occurs at contract date (not settlement date). For shares sold on a stock exchange, it's the trade date. Getting the timing right is important for managing your tax position — for example, delaying a sale by a few days to push it into the next financial year, or holding for at least 12 months to qualify for the CGT discount on a disposal before 1 July 2027. From that date the general 50% discount is abolished, and the timing of a CGT event instead decides whether the gain falls under the legacy discount rules, the new indexation-plus-minimum-tax rules, or the transitional split between them.
How it works
A CGT event is the legal trigger that turns a change in your ownership or control of an asset into a tax consequence — it's a broader concept than selling something, even though selling (CGT event A1) is by far the most common trigger encountered in practice. The tax law categorises CGT events from A through K, covering more than 50 distinct scenarios, including gifting an asset, an asset being lost or destroyed, a trust being created over an asset, a company cancelling or buying back shares, and even ceasing to be an Australian tax resident, which can trigger a deemed disposal of certain assets you hold.
Identifying exactly when a CGT event happens matters because it determines which financial year the resulting gain or loss falls into, and that in turn affects which year's tax return needs to report it. For real estate, the CGT event is generally triggered at the contract date — when you sign to sell — not the later settlement date when money and title actually change hands, which surprises people who assume the sale is finalised only at settlement. For shares traded on an exchange, the relevant date is the trade date, the day the transaction executes, rather than the day it settles a few days later.
Because timing is so central to CGT events, it becomes a genuine planning lever: delaying a sale by a few days can push a gain into the next financial year, spreading income across two years instead of stacking it into one, and holding an asset past its 12-month anniversary before triggering the CGT event is what unlocks the 50% discount on a disposal before 1 July 2027 — from that date the general discount is abolished, and the event's timing instead decides whether the gain falls under the legacy rules, the new indexation rules, or the transitional split between them. It's also easy to overlook that a CGT event doesn't require receiving cash at all — gifting an asset to a family member, or a company you hold shares in being wound up, both trigger a CGT event with real tax consequences even though no sale proceeds change hands.
Example: contract date vs settlement date
You sign a contract to sell an investment property on 25 June, with settlement occurring on 20 July the following financial year.
The CGT event (A1) is triggered on the contract date, 25 June — so the capital gain must be reported in the tax return for the financial year that 25 June falls in, even though the sale proceeds aren't actually received until settlement more than three weeks later, in the new financial year.
Related Terms
Capital Gains Tax (CGT)
Tax on the profit made from selling or disposing of an asset, such as property, shares, or cryptocurrency.
Cost Base
The total cost of acquiring and holding an asset, used to calculate the capital gain or loss on disposal.
50% CGT Discount
A 50% reduction in capital gains for individuals and trusts who held the asset for at least 12 months before disposal.
Capital Loss
A loss made when you dispose of a CGT asset for less than its cost base — can offset capital gains but not other income.