Profit on sale of shares

There is no straight answer to questions whether you have to pay tax on the sale of shares.

This relates to the concept of income. This concept provides some guidance to determine when an amount will be included in income of a person.

It is very important to look at the taxpayer’s intentions with the shares. According to National Distributor case and section CB3 in the Income Tax Act 2007, the sale is income if the taxpayer’s intention is to make profit from the sales. However, to determine the taxpayer’s intentions, the Court will look at other factors (including the nature, periods, scale, volume etc.).

Therefore, the decision will be varied from case to case and we recommend you to take professional advice before coming to a conclusion.

Disclaimer: The following answer is based on general principles only. The facts and background information of particular cases always need to be considered carefully as it varies from case to case, and it may be necessary to seek professional advice. 

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