I’m not sure if i have interpreted information from the revenue office in the correct way, can anyone help…?
I have an investment property which was initially my PPOR for 3 years. I have been using it as an investment for just under 6 years and have just listed it for sale. My understanding was that i don’t have to pay ANY Capital Gains Tax on it until after 6 years and from then on only a proportionate rate. Is this correct or will i have to pay some form of Capital Gains Tax upon sale?
Also, does anyone know if mortgage insurance is refundable to any extent. I have a deal settling late Jan which i then hope to sell (flipping is not really an option) within a couple of months. Will any of the $5k i will pay in insurance be refundable? I’m guessing no but here’s to wishful thinking! Thanks for the help! [blink]
Hi Keira,
No you will not have to pay any CGT if you sell within the 6 year period, PROVIDED you are not claiming another property as your PPOR at this time, for example if you are currently renting elsewhere.
You are only even entitled to one PPOR at any one time, with the exception of a 6 month transition period for instance if you are moving from say your old PPOR to your new PPOR (ie.awaiting settlement of either premises).
Cheers,
Jo
I am pretty sure you are spot on with the CGT.
Regarding the mortgage insurance, it is rare to get a refund from them but it is possible in some instances. It is a discretionary thing with the mortgage insurers and will probably depend a lot on whether the new purchaser pays mortgage insurance when you sell it to them. I would not be putting money on a refund.
Robert Bou-Hamdan
Mortgage AdviserM: 0414 347 771
E: [email protected]
W: http://www.mortgagepackaging.com.auComments made are of a general nature and should not be construed as individual advice.
© 2004 Mortgage Packaging Pty Ltd
Hi keira
You may be entitled to a partial refund on the LMI, I suggest you contact your lending institution for further details,
Also, have you checked with your credit provider to see if break costs will apply on the loan?Regards
Steven
Mortgage Broker
Mobile Mortgage Market[email protected]
http://www.mobilemortgagemarket.com.au
Ph:0402483216
Ph:1800 820 500
VICTORIAPLEASE note comments made should not be taken as specific taxation, financial, legal or investment advice.
I think you will find LMI will only be partially refunded if you sell within 6 to 12 months of the loan settling.
Terryw
Discover Home Loans
Mortgage Broker
Click below to email meTerryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Thanks all for the responses! Today i managed to get out of the deal that required mortgage insurance, turns out the exchange hadn’t happened yet and i got a get out of jail free card! BIG lesson learned there. As for the CGT, i am only renting at the moment so look forward to receiving 100% profits, very happy indeedy! Thanks
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