- reeceParticipant@johnreeceJoin Date: 2015Post Count: 7
Hi guys, A simple question…
I have just sold an investment property that I have had for 5 years.
The contract is dated 15/05/2016, with it going unconditional on the 29/05/2016 and a settlement date on 2/07/2016.
For tax purposes, is the capital gain assessed at the contract date or the settlement date?
The contract date means that I have to pay tax on the property this financial year but the settlement date means that I get an extra 12 months use of the money.
Which is the correct date?TerrywParticipant@terrywJoin Date: 2001Post Count: 16,213DeanCollinsParticipant@deancollinsJoin Date: 2015Post Count: 376
I’ve asked before but is there something that you can do to move a contract date…..eg if you write “an option to purchase on XYZ date” is this enough to move the date?TerrywParticipant@terrywJoin Date: 2001Post Count: 16,213
I’ve never looked into this, but a colleague did a conveyancing matter where the vendor used a put and call option to delay entering the contract (but lock it all in) and when asked why they stated for CGT reasons.DeanCollinsParticipant@deancollinsJoin Date: 2015Post Count: 376
To be honest I’m surprised it doesn’t happen more often…..
I’m assuming would need to be an option to “not go through with purchase ” right in order to pass ATO requirements of true risk (but what the heck do I know) but I’m sure a vendor would be happy with a 10% down “option to purchase with no refund if sale didn’t actually happen after the 1st of July”.
Would such a contract need to even be provided to ATO etc eg could just be shredded after regular sales contract actually gets signed on the 1st of July.