Originally Posted by
Cyclical
Agreed in principal, BP, but I'm not sure you understand my calculations...
Buy @ 136
Sell @ 163
Margin = 27c or 20%
Unfortunately it's not going to be 33% tax on the 27c (9c) because my average buy for OCA over the year is about 80c, so in the eyes of the IRD...
Sale of new parcel @ 163
Average buy = 80
Realised gain = 83
Tax @ 33% = 27c
That's a pretty tough result. Breaking even and that's before you consider brokerage and the risk that it may not see a 20% gain. Surely the system, if it is indeed strictly FIFO, is flawed and that LIFO would be a much fairer accounting method in this instance? Grey AF I suspect, unless it's well documented somewhere...?