CGT Advice

[rubber]

Need some advice (i am a bit confused)

Property 1 (bought 2.5 years ago)
My first Property is a 2 bedroom flat which i rented out in the first year and moved in before 12 months. I have been living in the property for over 1.5 years. I have claimed FHOG on this one.

Property 2
I have bought another property (which intend to live in the future) - 3 bedroom unit and i have currently rent it out as i cannot afford to move in. Currently Negatively geared
I bought this 12 months ago

What is my CGT situation if i want to sell Property1 ?
What is my CGT situation if i want to sell property2 ?

I would like to have Property 2 100 % CGT exempt as i bought it with the intention of living in it but did not move in.. can i make this my PPOR since the date of purchase and claim CGT exemption?

 

[Propertunity]

Property 1 (bought 2.5 years ago)
My first Property is a 2 bedroom flat which i rented out in the first year and moved in before 12 months. I have been living in the property for over 1.5 years. I have claimed FHOG on this one.....What is my CGT situation if i want to sell Property1 ?

You will pay CGT on any CG made in the first 12 month period while it was being rented out less a 50% discount because you've held the asset for more than 12 months. You should have had a valuation figure on purchase and another when you moved in 12 months later (for the CGT calculation purposes)

Property 2
I have bought another property (which intend to live in the future) - 3 bedroom unit and i have currently rent it out as i cannot afford to move in. Currently Negatively geared
I bought this 12 months ago. What is my CGT situation if i want to sell property2 ?

You will pay CGT on any CG made, less a 50% discount because you've held the asset for more than 12 months.

I would like to have Property 2 100 % CGT exempt as i bought it with the intention of living in it but did not move in.. can i make this my PPOR since the date of purchase and claim CGT exemption?

No, it was never your PPOR as you never lived in it at any time (if you sell it now).
If you do not sell it now and move into it, then the CGT calcs will apply as per Property 1 sale scenario above.
You may have had a case for 100% CGT exemption on this property but you had to have lived in it first before renting it out (which you did'nt).

 

[Brett IP]

Have a good read through this

http://www.ato.gov.au/corporate/content.asp?doc=/content/00208572.htm&page=16#P423_41144

 

[rubber]

Thanks Guys..

Looks like i should have consulted this forum or Accountant before i made this decision .

Any recommendations to remedy my situation?

 

[Propertunity]

Just a general comment from a buy & holder

If you never sell, you never pay CGT.
As the IPs grow, simply refinance cash out of them to use as deposits on more property....or anything else your heart desires.

 

[rubber]

Good one Mate
thanks for ur help