- Genesis01Member@genesis01Join Date: 2003Post Count: 56
What are the regulations behind claiming a property as PPOR
and therefore CGT exemption.
We are currently in employer subsidised housing
can we claim another property as our PPOR.
We originally lived in the other property for 2 years
then rented it out for the last 10 years.
Are we able to claim this property as our PPOR.
DarylblazeParticipant@blazeJoin Date: 2007Post Count: 60
Good question I've been wondering this myself too.TerrywParticipant@terrywJoin Date: 2001Post Count: 16,213
You can claim a place as your main residence after you have lived in it first. You can still treat it as your main residence while not living in it and renting it out, but only for up to 6 years. If you move in and out again, then the 6 years starts again from the date you move out. Have a look at the Income Tax Assessment Act 1996, section 118-145.Genesis01Member@genesis01Join Date: 2003Post Count: 56
So what are the current CGT liabilities,
does the standard 50% CGT apply on the full sale price?
Also what are the implications then, if I move back into the property?
DarylScott No MatesParticipant@scott-no-matesJoin Date: 2005Post Count: 3,856
CGT applies to the capital gain ie difference between purchase cost & sales price less any adjustments for depreciation claimedTerrywParticipant@terrywJoin Date: 2001Post Count: 16,213
CGs are just added to your annual income and you pay tax on this – so the rate will vary according to your income. If you hold the asset more than 12months, then you should be able to get the 50% reduction in CG too.elkamMember@elkamJoin Date: 2006Post Count: 722
As you have described the situation, if you were to sell you would be up for CGT on 4 years ( being the 10 years you have rented out minus the 6 that you are allowed before you lose your CGT free status.).
Hope this helps