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hidden capital gain

English translation: realised capital gain but not cashed in yet

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GLOSSARY ENTRY (DERIVED FROM QUESTION BELOW)
English term or phrase:hidden capital gain
English translation:realised capital gain but not cashed in yet
Entered by: zax
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05:56 Sep 8, 2006
English to English translations [PRO]
Bus/Financial - Finance (general)
English term or phrase: hidden capital gain
While the relief procedures are the same, there is the additional advantage that hidden capital gains and profits on which tax has been deferred are not taxed, since no change is made to the accounts and it is still possible to tax capital gains at a later stage.
Nuzzi
Local time: 13:23
realised capital gain but not cashed in yet
Explanation:
for example, you baught a house or a stock for $x. A year later it was valued at $2x. You made $1x in hidden capital gain. Once you sell your house or your stock, this hidden capital gain ceases to hidden and becomes taxable.

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Note added at 1 day3 hrs (2006-09-09 09:15:05 GMT)
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to be hidden
Selected response from:

zax
Local time: 06:23
Grading comment
4 KudoZ points were awarded for this answer

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Summary of answers provided
4 +4is a gain on an asset that is either not disclosedxxxjarry
3 +4capital gain posted on accounts not considered in gain calculation
Erich Ekoputra
5 +1realised capital gain but not cashed in yetzax
5Hidden capital gains and profits means Thay are Exempt from income taxAnna Maria Augustine at proZ.com


  

Answers


14 mins   confidence: Answerer confidence 5/5
Hidden capital gains and profits means Thay are Exempt from income tax


Explanation:
http://www.reference.com/browse/wiki/Capital_gain

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Note added at 18 mins (2006-09-08 06:15:06 GMT)
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No taxes are paid on the capital gains and profits so they are called "hidden".

Anna Maria Augustine at proZ.com
France
Local time: 12:23
Works in field
Native speaker of: Native in EnglishEnglish, Native in FrenchFrench
PRO pts in category: 24

Peer comments on this answer (and responses from the answerer)
disagree  Tony M: NO! It doesn't mean they are EXEMPT from tax, just that they are kept from showing in the accounts in such a way that they are taxable at a later date, instead of right away. / YES I DID!
10 mins
  -> DID YOU READ THE LINK?

agree  sigmalanguage: I don't think this is a normal usage of the word "hidden", but this is probably what it means in this context. I would like to draw everyone's attention to the expression "deferred", so the gains are recognized. They are sort of "hidden" from taxation.
6 hrs
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1 hr   confidence: Answerer confidence 3/5Answerer confidence 3/5 peer agreement (net): +4
capital gain posted on accounts not considered in gain calculation


Explanation:
Mine is very contextual interpretation. Later on, the aforementioned relief procedures will move the gain into more visible accounts. That is why the gain is not taxed now, but taxable at later stage.

Erich Ekoputra
Indonesia
Local time: 17:23
Works in field
Native speaker of: Native in IndonesianIndonesian
PRO pts in category: 20

Peer comments on this answer (and responses from the answerer)
agree  Tony M: Exactly for the interpretation; I'm not qualified to comment on the expression...
1 hr
  -> Thanks Tonny. Hope the expression gets better next time. :)

agree  Fabio Descalzi: Baik baik!
6 hrs
  -> Terima kasih...

agree  xxxAlfa Trans
10 hrs
  -> Thank you Marju.

agree  webguru
2 days5 hrs
  -> Thank you webguru.
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2 hrs   confidence: Answerer confidence 4/5Answerer confidence 4/5 peer agreement (net): +4
is a gain on an asset that is either not disclosed


Explanation:
or (deliberately) understated in financial statements.
It is a departure form standard accounting practice since it implies that the financial statements do not give a true and fair view of the entity's financial position. Once such an asset is disclosed, and/or recognised at its fair value, or sold, the resultant difference is a gain that may or may not be taxable in due course, depending on the tax lesgislation in force in the jurisdiction concerned.

xxxjarry
South Africa
Local time: 12:23
Specializes in field
Native speaker of: English

Peer comments on this answer (and responses from the answerer)
agree  Tony M: That's the way I see it too!
58 mins
  -> Thank you

agree  Dave Calderhead
58 mins
  -> Thank you

agree  Lucica Abil
3 hrs
  -> thank you

agree  Mwananchi
4 hrs
  -> thank you

neutral  sigmalanguage: This is the usual meaning, but a problem is that if the gain is not shown on any document, tax authorities can never tax it. So no question should arise as to whether to tax it or not. In addition, you don't say "deferred tax" when there is no tax.
5 hrs
  -> Tax is effectively delayed until recognition of the asset at its fair value or its sale, resulting in any capital gain (or loss) being recognised as well. My choice of the term 'deferred' was a little unfortunate.
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1 day3 hrs   confidence: Answerer confidence 5/5 peer agreement (net): +1
realised capital gain but not cashed in yet


Explanation:
for example, you baught a house or a stock for $x. A year later it was valued at $2x. You made $1x in hidden capital gain. Once you sell your house or your stock, this hidden capital gain ceases to hidden and becomes taxable.

--------------------------------------------------
Note added at 1 day3 hrs (2006-09-09 09:15:05 GMT)
--------------------------------------------------

to be hidden

zax
Local time: 06:23
Specializes in field
Native speaker of: Native in ArabicArabic, Native in EnglishEnglish
PRO pts in category: 16

Peer comments on this answer (and responses from the answerer)
agree  Lucica Abil: Very good example!
4 days
  -> Thanks, Lucia
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