Hi Mark

Sorry I didn't see my case in the above. We bought the property which we live in now as an investment property in 2001 we started living in it in 2004, if we were to sale now are we liable for CGT

Thankyou

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Hi Mark

We get accommodation with our work. We did not have house and bought in 2022 and rented out straight away, we don't own any other property but have never lived in this one although we are thinking of moving into it later this year. If we were to sell will CGT apply.

Rod

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In the scenario you described, whether you are liable for Capital Gains Tax (CGT) upon selling your property depends on several factors. Here are some general points to consider:

Primary Residence Exemption: If you acquired the property in 2001 as an investment and later moved in and made it your primary residence in 2004, you may be eligible for the primary residence exemption for the period you lived in the property (2004 onward).

Capital Gain Calculation: When you sell the property, any capital gain will need to be calculated based on the time it was owned:

From 2001 to 2004, when it was an investment property, you may be liable for CGT on the capital gains accrued during that period.

From 2004 onwards, while it was your primary residence, it may be exempt from CGT.

Apportionment of Gain: You would typically need to apportion the capital gain based on the duration the property was rented out (as an investment) versus when you lived in it (as your primary residence). The gain attributable to the investment period may be subject to CGT.

Ownership & Duration Incentives: As you owned the property for more than 12 months, you may eligible for a 50% discount on the capital gain before including it in your taxable income.

Partial Exemptions: If the property was rented out part of the time, and you're claiming exemptions for those periods, you may need to consider that in your calculations.

Given these factors, it is highly recommended to consult with a tax advisor or accountant who specializes in Australian tax law to understand your specific situation and ensure compliance with the Australian Taxation Office (ATO) regulations. This will help you assess any potential CGT liability accurately before selling the property.

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