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I simply hate tax law... pure and simple it is a pain in the proverbial yet I practice and study regularly. That even amazes me sometimmes as I am trying to work out whether I will be a nutty profeesor at Gladesville!

It should be noted that the character of an item never changes, if it is an asset it is an asset! If it is a capital gain (or loss) on sale of an asset it is a capital gain (or loss) and the treatment of the profit from the gain (or loss) will be treated differently had you transacted the acquisition and sale in 12 months or in excess of 12 months.

Note that you can have a business being a 'share trader' and in this instance it is necessary to prove to the ATO that you are a share trader not a mere casual investor. Therefore they (ATO) judge matters according to the number of share trades that one does in a particular year. To my mind you can trade shares and warrants as a business. Note that you can even transfer assets from trading stock to fixed assets under the legislation so whilst you trade in one stock you can transfer other stocks to assets as a revenue supplier (by virtue of dividends).

If it all gets too complicated try the search engine out at thsi URL.

http://law.ato.gov.au/atolaw/view.htm?basic=capital+gains+tax%20assets+bought+sold+in+a+12+month+period&&docid=TXR/TR964/NAT/ATO/00002
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