Tax Lot Tracking for Australian Investors

What is a tax lot?

A tax lot (or parcel) is a group of shares purchased in a single transaction at a specific price on a specific date. When you buy 100 BHP shares today and another 100 BHP shares in six months, you have two separate tax lots — each with its own cost base, acquisition date, and CGT eligibility.

Why does it matter so much for Aussie investors?

• The ATO’s 50% CGT discount only applies to parcels held for at least 12 months
• Each parcel’s cost base is calculated independently — DRP shares, brokerage adjustments, and corporate actions each affect specific lots
• Which lot you choose to sell first can mean the difference between paying full tax and paying half

FIFO, LIFO, and specific parcel selection

The ATO does not prescribe a mandatory lot identification method for shares — you can choose which parcel you’re selling, provided you can identify it. The three main methods are:

• FIFO (First In, First Out) — the oldest parcel is sold first. Often triggers the CGT discount automatically once you’ve been investing for more than 12 months, but may realise larger gains on older, lower-cost parcels.
• LIFO (Last In, First Out) — the newest parcel is sold first. Rarely beneficial for long-term investors; the newest parcels usually haven’t hit the 12-month discount threshold.
• Specific parcel selection — you nominate exactly which lot to sell. This is the most powerful method: you can target the parcel that produces the smallest net tax outcome, whether that means choosing the highest cost base, the oldest holding, or one that can be offset against a capital loss.

Crowdfolio runs the three CGT methods live and displays the after‑tax proceeds for each before you hit confirm.

Why tracking lots manually fails

Most investors start tracking their lots in a spreadsheet. This works for a handful of holdings — until dividend reinvestment plans kick in, corporate actions (splits, mergers, spin-offs) occur, or you have 10 years of monthly DRP allocations across a dozen ETFs. At that point, spreadsheet errors compound and lot records become unreliable.

Brokers usually serve up an average cost per share instead of the lot‑by‑lot breakdown. That average makes reporting easy, but it wipes out the detail you need to pick the best CGT parcel.

How Crowdfolio tracks your lots

1. Import your transaction history via CSV from CommSec, Stake, Pearler, Sharesight, or manual entry
2. Each buy transaction creates a separate lot with its acquisition date, units, and cost base (including brokerage)
3. Corporate actions — splits, consolidations, mergers, return of capital — are applied to the correct lots automatically
4. DRP allocations are recorded as new lots at the dividend date and DRP price
5. When you sell, Crowdfolio shows you the tax outcome for each lot identification method and recommends the optimal selection

Tax lot tracking inside an SMSF

SMSFs must maintain accurate lot records to meet ATO audit requirements. The fund’s auditor will want to verify that CGT calculations are based on correct cost bases and acquisition dates. Crowdfolio supports SMSF, individual, company, and trust account types — with full lot history exportable in ATO-compliant format for your auditor.