All Topics / Legal & Accounting / How long before cgt applies??

Viewing 6 posts - 1 through 6 (of 6 total)
  • Profile photo of Misty1Misty1
    Member
    @misty1
    Join Date: 2004
    Post Count: 348

    Hello,
    I am wondering about selling an i.p.
    My qu is this: if cgt applies on 50% after 12mnths,is that of it earning rent? Or of ownership of the property??[confused2]
    I ask b/c, i am wondering if i owned the land for 3 to 4 yrs,then built,now rented, if i sold within less than 12mnths of building,how much cgt would apply??? Help![blink]

    Profile photo of aussierogueaussierogue
    Participant
    @aussierogue
    Join Date: 2003
    Post Count: 983

    misty – cgt applies on 50 pct upto 12 mos after date of purchase of the block, not the building of the house.

    Profile photo of agent smithagent smith
    Participant
    @agent-smith
    Join Date: 2003
    Post Count: 22

    Hi Misty1,
    The ATO website has a downloadable e-CGT calculator. You can plug in justabout any scenario and it will calculate CGT payable.
    Just a thought![worried]

    Profile photo of Misty1Misty1
    Member
    @misty1
    Join Date: 2004
    Post Count: 348

    thnx re; website.very helpful.

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,213

    Misty

    I think you are a bit confused. CGT is applied to the gain in the value of property. If less than 12 motnhs the gain is just added to your income (less some deductions), if over 12 months, you can get a discount and only 50% of the gain is added to your taxable income. So how much tax you will pay will also depend on your income for the year.

    Terryw
    Discover Home Loans
    North Sydney
    [email protected]

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://www.Structuring.com.au
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au

    Profile photo of crjcrj
    Participant
    @crj
    Join Date: 2004
    Post Count: 618

    Misty

    You might find the ATO would consider this as 2 separate assets – the land as one and the new building as another. Also if you’re developing to sell they might look at that as ordinary income and not capital gain

    crj

Viewing 6 posts - 1 through 6 (of 6 total)

You must be logged in to reply to this topic. If you don't have an account, you can register here.