Cutting tax on share transfers

Cutting tax on share transfers


While the transfer of shares from an individual to their super fund will trigger a CGT event and therefore capital gains tax, there are ways individuals can minimise this.

Individuals can transfer shares to a self-managed superannuation fund (SMSF) by completing an off-market transfer, also known as an in-specie transfer. An off-market transfer is the transfer of securities between two parties without using the services of a stockbroker. It means that the shares in question do not have to be sold.

Because the sale involves changing the beneficial ownership structure of the shares from an individual’s personal name to the name of the super fund, it may trigger a capital gains event.

A capital gains event means that an individual may have to pay capital gains tax if they made a profit on the shares being sold. One way to minimise the tax payable is to group transfers of shares with losses with any shares that have gains, which can offset the probability of paying tax.

Alternatively, individuals can also maximise their concessional contributions in the year in which the share transfer occurs via salary sacrifice, which can lower their taxable income and thus lower their capital gains liability.

To manage their tax liability more efficiently, individuals should consider transferring different tranches or combinations of tranches over several financial years. Seeking professional advice can help when calculating capital gains tax or combinations mentioned above.

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If you believe the matters discussed above are relevant to your business, please contact Darren Smith of our office to discuss further.


Darren is a Chartered Accountant with extensive experience, including working in the big 4 and medium sized firms before becoming a partner of a city based firm in 2000.

He has gained much experience and has extensive knowledge in providing business and taxation advice, superannuation planning, negotiation of sales and acquisitions of businesses and property development. His client base covers a wide range of industry groups.

Darren works with business owners to grow their businesses and create personal wealth within and outside of their business.


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