Ask Paul: Our son lived in his house then rented it out, does he owe CGT?
Paul, our son is a missionary in Kenya. He and the bank have had an Australian home together for about 17 years - he lived in the home for 11 to 12 years.
He is now back in Australia and has complied with tax rules while in Kenya.
However, if he ever sells his home will he have to pay capital gains tax? Or is there any way he can be exempt? Hope you can help. - Maryke
We can put the pandemic aside for a moment with a CGT issue, but one thing I am sure about, Maryke, is that you would be pleased to have your son back in Australia.
I strongly suggest your son goes straight to his accountant to check out the "six-year rule".
You can maintain your family home status if you are away from it for up to six years.
Equally, at worst CGT should be pro rata for the proportion of time he has lived there.
But it sounds as if it may be around that six year mark now. He really needs personal advice ASAP.
Get stories like this in our newsletters.