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hi there,
I have a "friend" who sold/transferred his house(investment property) in 2005 for around 174,000AUD to his close "mate", as he was in a spot of bother due to mental health issues, all done in a legitimate way. He now is in the process of buying back the property and has had a sworn valuation on the property done which came in at $330.000AUD. Now here in lies the "problem!" Both my friend and his "mate" intend to pay all related ATO (Capital Gains Tax )& SRO (Land Taxes) based on the valuation of $330.000AUD. However the Contract Of Sale will read $170.000AUD, which will be covering the balance of loan,$118.000AUD CGT, Land Tax, Legals etc. Now once back in his "mates" name, will he have to pay any future GCT if he on sells down the track based on a the Contract Of Sale reading at $170.000AD or will the ATO & SRO see that appropriate taxes were already paid based on the valuation of $330.000UD.Regards
Dotoh….Hi there, I have another question: If my friend sells me his property for around $170,000 AUD, however the true value is around 280,000AUD. Although it's a generous offer, I am unsure of what the CGT tax implications are for him, as the property has been and still is currently an investment property (the tenants will move out when the property sells & it will become my PPOR). Will the ATO bill him for the true value of around $280,000AUD or process his tax at the sale price of $170,000 AUD. BTW he paid around $167,000AUD about 5 years ago for the property.
Thanks. dotohHi there,
I have read through your comments, but haven't found an answer which fits my situation:
I have the opportunity to puchase a property for a very cheap price (less than its market value). The property is already tenanted.
I am looking at leaving the tennants in for another 12 months or so. While they are in there, the property needs a few maintainance issues dealt with (i.e. new carpet, replace showers, etc.). After the 12 months, I wish to move in and use it as my ppor for say 2 years before on-selling. What would be the cgt implications for me if I sold the house with a substantial profit?
Thanks, dotoh
