From the ATO website they mention that CGT exemption does not apply where a new asset has been created.
I have bought an old home, knocked it down and put up 3 units. If I hold the three units for one year does the ATO ruling mean I will not be able to get the 50% CGT exemption?
Thanks[:X]My understanding is that the CGT 50% discount applies on assets held for 12 months or longer. You’ll need to confirm with the ATO what the cost base date will be, ie will it be the date you bought the original old home/land. There is a CGT legal advice line at the ATO which I believe is available for tax agents…perhaps you can wrangle some information out of them.
From the ATO website they mention that CGT exemption does not apply where a new asset has been created.
I have bought an old home, knocked it down and put up 3 units. If I hold the three units for one year does the ATO ruling mean I will not be able to get the 50% CGT exemption?
ThanksTouchy area – section 115-25 states that a CGT discount is not available where a new CGT asset has been created.
However, I don’t think they mean to include a new house as that type of asset, they mean contract assets, such a leases/stock that are created on realisation of the underlying issue… to technical to explain here..
Just check with your account…
Pete
…Beware of the dreamtakers…
Thanks for the advice. I think you are right – my accountant says that we may create a new asset on the land we bought – this has to be held for 12 months for the CGT exemption (ie. No longer a new asset then).
Touchy area – section 115-25 states that a CGT discount is not available where a new CGT asset has been created.However, I don’t think they mean to include a new house as that type of asset, they mean contract assets, such a leases/stock that are created on realisation of the underlying issue… to technical to explain here..
Just check with your account…
Pete
…Beware of the dreamtakers…
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