Principle Place Of Residence?

Viewing 7 posts - 1 through 7 (of 7 total)

Larelle
Member
@larelle
Join Date: 2004
Post Count: 10
February 14, 2004 - 11:47 am
We have an investment property that has been tenanted for 2 years. If we were to sell off our principle place of residence and move into the investment property for a period that would exceed 3 months, does anyone know if that investment property would then be considered to be our PPOR if we were to sell that down the track?
lj
TeacherK6
Member
@teacherk6
Join Date: 2003
Post Count: 164
February 14, 2004 - 1:04 pm
Hey Larelle
From what i know, this MAY be your answer…
It will be your PPOR if you move into it, obviously you will need to change a few official documents to verify this ie electoral roll registration, banks, RTA, etc etc
As to how long u actually need to be “living” there for, i think there is no actual minimum mentioned in the tax info booklets, but this may be verified by someone else.
Are you asking for CGT reasons??? if so, im also thinking that u need to pay CGT on the 2 years it was an investment property should you sell, and the percentage of CGT reduces as you live in it for longer, but there are so many rules, that u need to get the info in your hand in a booklet form or from the net so u can actually see this info first hand…
Hope my info was correct, but im no accountant…
Jason
Larelle
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@larelle
Join Date: 2004
Post Count: 10
February 15, 2004 - 12:38 am
Thanks Jason,
I was asking for Capital Gains reasons, the tax laws are so complex that half the time the poor old account has trouble answering. What you said made sense, and I appreciate your time. Thanks mate.
lj
Tring
Member
@tring
Join Date: 2004
Post Count: 24
February 16, 2004 - 3:31 am
Hello Larelle;
As Jason said, I just want to add;
For Capital Gain Tax; From some books I have read;
The % of CG tax is calulated as: No. of Years rented out/No. of Years lived in.
Regards
Start
Larelle
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@larelle
Join Date: 2004
Post Count: 10
February 16, 2004 - 4:08 am
Thanks guys,
I appreciate you help
Larelle
lj
Terryw
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@terryw
Join Date: 2001
Post Count: 16,213
February 16, 2004 - 6:53 am
I owuold think it would become your PPOR from the date you moved in, but would pay CGT on the gain during the years it was rented.
Terryw
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North Sydney
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melbear
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@melbear
Join Date: 2003
Post Count: 2,429
February 17, 2004 - 1:10 pm
Yep, agree with the others. It will become PPOR as you move in. If you only stay in it for three months prior to selling, the CGT will be based on 24 out of 27 months. So, on 24/27th of the gain, which is still huge.
However, I think you could still move out for up to 6 years – if you have no other PPOR in that time – ad move back in and then sell it, and pay pro rata based on 6 years owning, 2 years rental, so down to 1/4.
Seek a better accountant if yours cannot help.
Cheers
Mel