All Topics / Legal & Accounting / PPOR and CGT
Hi Guys,
I purchased a PPOR back in 2007 and for the last 10 years has been rented out. I wanted to sell the property to pay a second property off. I know moving back in won’t make a difference for CGT purposes but is any other way I can reduce or minimise it? Feels like such a loss.
– consider whether you can use the six year main residence absence rule and the impact on any other property which may have been your main residence
– why won’t moving back in make a difference for CGT purposes ?
– look at third element costs to reduce the capital gain where appropriate
– did you really move into it and make it your PPOR ?PTSMike | Property Tax Solutions
http://www.propertytaxsolutions.com.au
Email Me | Phone MeProperty Investment Tax Accounting - Sydney | Melbourne | Brisbane | Perth | Adelaide
https://www.finder.com.au/capital-gains-tax-selling-property
Main place of residence
You can avoid paying CGT if you sell a dwelling that’s considered your main place of residence. You can only ever have one main residence at any given time unless you’re selling your old main residence and buying another. In this case you’re entitled to an overlap period of six months as long as the new property will be your new main residence, you lived in the old property for at least three continuous months in the 12 months before you sold it and it wasn’t used to produce rent in this same 12 month period. The ATO doesn’t give an exact description of what constitutes a main residence, but gives the following points to consider:You and your family live in the dwelling.
Your mail is delivered there.
You have your personal belongings there.
You’re registered to vote at the property’s address.
You have connected a phone, gas and electricity to the property.
If you’ve lived in your home for the whole time you’ve owned it, haven’t rented it out either completely or to a lodger and the land is smaller than two hectares, you’ll get a full exemption on CGT when you sell. This is helpful if you plan to live the renovator’s life: selling your home, moving into another, renovating it and then selling the renovated property. And while you won’t make a rental income if you go down this path, all profits made from the renovation are exempt from CGT.Jaxon | Jaxon Avery – Financial Adviser
http://www.jpafinancialservices.com.au
Email Me | Phone MeJPA Financial Services Pty Ltd
Jaxon | Jaxon Avery – Financial Adviser
http://www.jpafinancialservices.com.au
Email Me | Phone MeJPA Financial Services Pty Ltd
https://www.finder.com.au/capital-gains-tax-selling-property
Main place of residence
You can avoid paying CGT if you sell a dwelling that’s considered your main place of residence. You can only ever have one main residence at any given time unless you’re selling your old main residence and buying another. In this case you’re entitled to an overlap period of six months as long as the new property will be your new main residence, you lived in the old property for at least three continuous months in the 12 months before you sold it and it wasn’t used to produce rent in this same 12 month period. The ATO doesn’t give an exact description of what constitutes a main residence, but gives the following points to consider:
You and your family live in the dwelling.
Your mail is delivered there.
You have your personal belongings there.
You’re registered to vote at the property’s address.
You have connected a phone, gas and electricity to the property.
If you’ve lived in your home for the whole time you’ve owned it, haven’t rented it out either completely or to a lodger and the land is smaller than two hectares, you’ll get a full exemption on CGT when you sell. This is helpful if you plan to live the renovator’s life: selling your home, moving into another, renovating it and then selling the renovated property. And while you won’t make a rental income if you go down this path, all profits made from the renovation are exempt from CGT.2 potential errors in this quote Jaxon.
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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