# Asset taxed differently in various countries



## mths (Oct 23, 2018)

Wow, how happy am I to see this board. Let's see if someone can offer guidance in my case..

Essentially, I've got an asset which when sold, I should use moving average cost basis to calculate gains and losses. I've done this in Sweden, and I'm doing it in Japan. Soon I'm moving to Australia, and there they go by FIFO.

What now? Ideally I could argue that I've sold off x% of my first purchased lot, but I doubt that would fly. I mean it would be totally fair and correct, but probably just too much of a hassle for them to deal with.

So what happens in a case like this? Is my entire trade history processed from scratch with FIFO and sucks-to-be-me if I end up having to pay double tax somewhere somehow?


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## Bevdeforges (Nov 16, 2007)

Ultimately, it may depend on any existing tax treaty between your last country of residence and your new country of residence (Australia, I guess).

It would seem logical and rational to kind of "freeze" your asset records (investment accounts?) as of the date that you change residence. If Australia requires FIFO rather than average, you just need to lock in the dates and values of your remaining assets as of when you make the big move. From that point on, you can use FIFO for your tax reporting I would suspect. (And be able to defend it to any tax examiner.)

If you don't have the dates and values of your original purchases anywhere, you could freeze the value of your portfolio at the date of your move and apply the average value to all shares/assets at that date. Going forward, you'd have to track lots so that you could apply FIFO values for future sales.
Cheers,
Bev


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## mths (Oct 23, 2018)

Bevdeforges said:


> It would seem logical and rational to kind of "freeze" your asset records (investment accounts?) as of the date that you change residence. If Australia requires FIFO rather than average, you just need to lock in the dates and values of your remaining assets as of when you make the big move. From that point on, you can use FIFO for your tax reporting I would suspect. (And be able to defend it to any tax examiner.)


Thank you Bev for the reply,

Could you explain what you mean by "freeze" here?

I've got perfect records so I'm not worried about that part.

Lock in datesd and values .. are you saying I can do what I suggested in my OP? Ie. claim that I have let's say 40% left of the very first lot I bought. So I have some amount of it at that price and purchase date .. and so on for every purchase .. I'm sorry, this is kind of hard to talk about without drawing diagrams and stuff, are we on the same page here, did I understand you right?

And yes, ultimately it's up to the interpretation of the law and agreements between countries etc etc, of course.


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## Bevdeforges (Nov 16, 2007)

By "freeze" all I mean is to draw up a list (or spreadsheet if you prefer) of your assets as of the date that you move. You can either fix their value at that date at average cost, or just list the specific lots you still own with their dates of purchase and purchase cost detailed. In the first case, you might wind up having to use your move date as the "acquisition date" which could be a problem with short and long term gains. (Depending on the tax system.)

Again, with most tax systems, what they need and want is a good faith effort to keep track of the purchase dates and prices of what you have when you first become resident in the country. After that, you can track specific lots to keep the tax people happy.
Cheers,
Bev


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## mths (Oct 23, 2018)

Bevdeforges said:


> By "freeze" all I mean is to draw up a list (or spreadsheet if you prefer) of your assets as of the date that you move. You can either fix their value at that date at average cost, or just list the specific lots you still own with their dates of purchase and purchase cost detailed. In the first case, you might wind up having to use your move date as the "acquisition date" which could be a problem with short and long term gains. (Depending on the tax system.)


"list the specific lots you still own with their dates of purchase and purchase cost detailed"
This is what I'd like to do, but since I've followed the average approach up til now, I've sold off fractions of all my lots. It's not a matter of "I have this lot but not that one", it's a matter of "I got x, y and z % left of this, that and the other lot". Anyway from your answers I take it this is actually an acceptable approach? I was afraid it'd be too complicated.



Bevdeforges said:


> Again, with most tax systems, what they need and want is a good faith effort


Yesss I've read this before, and I hope it's true, because dammit I try harder than most.

Thank you again.


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## Bevdeforges (Nov 16, 2007)

Just be sure to leave a record of whatever you decide to do. As long as you can explain it should any question ever arise, and show where your numbers came from, they can't really protest too much.
Cheers,
Bev


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