Hi,
My fiance and i purchased a property last year which we have not yet moved into. Currently we have some long term tenants in the property paying $300pw, our repayments on the mortgage are roughly $650pw on a 430K loan. We were planning to move into this property later this year, but are now thinking of spending $300pw renting a property in a more handy location. From a base financial position it shouldn’t make much difference. ie. either $650pw if we live in our own property or ($300pw rent + $350 mortgage) $650pw in the buy+rent scenario. My question is what are the potential pitfalls tax wise? Any advice would be appreciated. Thanks.Cheers,
JacobGet some good advice before you do anything.
If you live in the property, you could class it as your main residence, and it will be CGT exempt for a period of up to 6 years if you do not class another proeprty as your main residence.
Terryw
Discover Home Loans
Mortgage Broker
North Sydney
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Thanks Terryw,
Our plan is to move into it eventually, so the CGT may not be an issue. How long do you have to live in it to claim it as your main residence?You can’t claim it as a main residence until you live in it. So during that time you will not get CGT exemption, so it is a good idea to live in it asap. No lenght of time is specified as the minimum, but generally 6 months is considered advisable.
Terryw
Discover Home Loans
Mortgage Broker
North Sydney
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
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