Viewing 7 posts - 1 through 7 (of 7 total)
  • Profile photo of ozzyozzy
    Join Date: 2017
    Post Count: 2

    I bought my PPOR and rented it out for the first year of ownership. Then lived in it for 2 years after that. Am i liable for cgt? We are thinking of selling to buy land.

    Also during this period, about a year ago i bought an investment property and because i had no idea about structure back then i securitised my PPOR to buy my investment property.

    My questions are:

    Do i need to pay CGT?
    If i buy land and sell my PPOR what do you suggest is the best way to go about it if its securitised with my investment?

    Profile photo of wilko1wilko1
    Join Date: 2010
    Post Count: 510

    Did you rent it Immediately after owning it ?
    Most likely yes there will be some but apportioned for the time rented vs PPOR. I am sure another one of the experts will give you further detail


    Profile photo of Ethan TimorEthan Timor
    Join Date: 2016
    Post Count: 282

    Hi Ozzy,

    If you bought and rented out without living in it first, then yes, you’ll probably need to pay CGT for that period.

    If the properties are crossed, then when you’ll sell the PPOR, the lender will want to do a valuation on the IP to ensure that they have sufficient security. Only then the lender will discharge the mortgage on the PPOR, allowing the sale to settle.

    All these things could be addressed before proceeding with the sale. Speak with your broker/bank 👍😎

    Hope this helps?


    Ethan Timor | Aligned Finance Pty Ltd
    Email Me | Phone Me

    Active Investor & Broker; Based in Northern NSW, servicing Australia wide; Author of '34 Proven Ways to Maximise Your Borrowing Power' (download free from our website)

    Profile photo of Jamie MooreJamie Moore
    Join Date: 2010
    Post Count: 5,069

    Do i need to pay CGT?If i buy land and sell my PPOR what do you suggest is the best way to go about it if its securitised with my investment?

    1. Probably for the first year – ask your accountant to confirm
    2. Don’t cross collaterise the properties. Release equity against one to fund the deposit/costs on the other

    If in doubt – get a decent finance person to sort it out for you.



    Jamie Moore | Pass Go Home Loans Pty Ltd
    Email Me | Phone Me

    Mortgage Broker assisting clients Australia wide Email: [email protected]

    Profile photo of ozzyozzy
    Join Date: 2017
    Post Count: 2

    To get this right. I have not mentioned another investment property which i have had for 7 years and has equity and is stand alone (all 3 properties with CBA). If i draw equity from that property(with a different bank) to fund my 1 year investment to 80% LVR. Would that get rid of security?.. If so, when i sell my 7 year old property (possibly this year). Would the cash gained from the sale have to pay the equity i have released from it or does that loan stay with my 1 year old investment property?
    I hope this makes sense.

    Thanks for the answers guys. Much appreciated!

    Profile photo of BennyBenny
    Join Date: 2002
    Post Count: 1,416

    Hi Ozzy,

    This is sounding more and more complex. I am with Ethan and Jamie – you need to sit down with someone (Broker or Bank Rep) to discuss your options. There are right ways and wrong ways to unwind all of this – you will want to do it the right way.

    I hate to say it, but “most” bank people only have info re their end of things, whereas a good Broker (like Ethan or Jamie) can give you “chapter and verse” on most aspects of loans, including unwinding cross-colled properties, as well as coming up with the BEST lender to approach re the second IP, AND give you reasons why their choice is the best.

    A banker can only promote their own employer’s offerings, thus limiting your options, and the knowledge you might glean.

    Click on this link to read of another member who is uncrossing cross-securitised houses – and the Bank is dictating terms that are NOT to the benefit of the borrower –

    THAT is why I would recommend getting a third-party to give you a holistic “outside look” at this before going to your bank.


    Profile photo of TerrywTerryw
    Join Date: 2001
    Post Count: 16,213

    Your other property is irrelevant for this transaction unless you are claiming that as the main residence.

    Yes you will need to pay CGT if there has been a gain.

    It seems you have owned it 3 years but rented it for one year, work out the cost base of the property – include expenses while living there such as interest, rates etc (third element of the cost base).

    Then multiply this by 1/3.

    Then this number by 50% (as you have owned more than 12 months).

    This figure is then added to your other income and you will pay tax on it at your marginal tax rate.

    It may come out to be nil or very low depending on the situation.

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide)

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

You must be logged in to reply to this topic. If you don't have an account, you can register here.