can someone explain in simple terms what tax I have to pay as

Foreign source income tax

>>1068340
Gains on selling the investments will be subject to Australian capital gains tax, exactly the same as selling domestic shares. The exception would be if you were a professional share trader, in which case you would treat the shares as trading stock, but I don't think you would be asking this question if you were a professional share trader.

Dividends may be subject to withholding tax in the US. You have to declare the full amount of the dividend (ie including the tax that was taken out) as assessable income in your Australian tax return. You can then claim a foreign income tax offset for the US tax.

Example (assume amounts are converted to AUD): You buy $100k in US shares today. On 20 June 2016 and 15 January 2017, the company pays dividends worth $1k each. US tax is withheld from the dividends at 15%, so you actually receive $850. On 10 May 2017 you sell the shares for $110k.
In your 2015-16 tax return, you include $1k as assessable income (even though you only got $850 in your pocket) and you can claim a foreign income tax offset of $150 to cover the US tax you paid.
In your 2016-17 tax return, again you'll have $1k from the dividend and FITO of $150. You'll also include a capital gain from selling the shares. This will be the amount you sell them for ($110k) minus the cost of acquiring them ($100k) multiplied by 50% because you held them for over 12 months. So your net capital gain is $5k, which is then included in your assessable income.

>>1068425
thanks, whats the percentage taxed if held for less than 12 months? i.e. a few hours

>>1068449
As far as capital gains tax, if you hold something for less than 12 months then you're taxed on the full amount of the gain.

But if you're buying and selling shares every few hours, then you're most likely not in CGT territory anymore. In that case you would basically include all the money you get from selling shares as assessable income, and claim all the money you spend buying them as a deduction. You may also need to include an extra amount as either assessable income or a deduction to account for the difference in the opening and closing values of your shares on hand.

If you're really carrying on a business of share trading (rather than just 'investing' in shares), then you should probably talk to an accountant.