Hi All,
I was wondering if anyone can shed some light on an issue that my partner and I are trying to work out.My partner was left a unit by his dad in his will. It was originally purchased possibly around 1986 (I still need to find all that paperwork but this is going off his memory). His father passed away in 1998 and he has never gone through probate so the property is still in his dad's name. My partner lived in the property for about 3 or 4 years from 1997 to 2000ish. Since he moved out he has a friend living there and has never charged him rent (don't ask me why. Good mate I suppose) and has never claimed anything on tax etc…
We have a couple of questions that we just don't know the answer too and neither of us are very good at figures and understanding tax rulings and the like.
Would he have to pay capital gains tax if he sells the property?
How would that be calculated considering he lived in it for 3 years or more?
If he has never received an income from it or used it for tax purposes would that affect the CGT?
I heard a rumour that if a property was purchased before 1987 then no CGT is payable. Is that correct?
Does anyone know if he sold it would it then affect his 'Taxable income' for the purposes of child support?Any thoughts would be appreciated. Oh we are in NSW if that makes any difference.
Was it your partner's dad's home? Or was he renting it out to someone else?
There is no CGT payable if the property was purcahsed before Setember 21 1985.
Hi Dan,
Yes it was his dad's home which he lived in, he never rented it out. He lived in it till he passed away in 1998. My partner lived there with him from 96 or 97 till 2000. I can't find any purchase papers but the date on the plans says 1986. So I guess CGT is payable if he purchased it later that September 21 1985? Any idea how they will apply that?If it was your partner's Dad's PPOR until he died then the value will start at the value at the date of death. If your partner was living in it and had no other PPOR that period of ownership will also be exempt from CGT. After that period the answers will depend on whether your partner had another PPOR during the next 6 years at any time. In any event if your partner has not been getting any income from the property holding costs such as rates, repairs and insurance will form part of his cost base reducing any CGT further.
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