Hi
Wondering if anyone has experienced this or knows how to tackle it.
I bought a house in Aug 2005 already rented and moved in 12 months later after I gave the tenants notice. I then lived there from Aug 2006 until I sold it in April 2013.
When I moved in within 12 months of purchasing it, I had the property valued by a registered valuer in Aug 2006. It was valued at the same price as to what I bought it for.
The ATO has been in touch saying I owe CGT and is using s118-192 apportioning the days is was rented divided over total ownership days. I have tried using the valuation and saying my gain is zero (valuation = purchase price) but the ATO says I cant use the valuation, only the apportionment.
If the situation was reversed and it was my PPOR from day 1 and i rented it later, I could use the valuation. But the valuation doesnt work the other way around (that is, rented then PPOR).
I find this ridiculous that instead of using a mathematical linear apportionment, the ATO does not consider the use of the valuation when I property is rented then is used as a PPOR but only when it was originally your PPOR then is rented out.
Anyone been in this situation or know of other sections of the ITAA/cases where I can use the valuation?
Cheers
Daniel
Wondering if anyone has experienced this or knows how to tackle it.
I bought a house in Aug 2005 already rented and moved in 12 months later after I gave the tenants notice. I then lived there from Aug 2006 until I sold it in April 2013.
When I moved in within 12 months of purchasing it, I had the property valued by a registered valuer in Aug 2006. It was valued at the same price as to what I bought it for.
The ATO has been in touch saying I owe CGT and is using s118-192 apportioning the days is was rented divided over total ownership days. I have tried using the valuation and saying my gain is zero (valuation = purchase price) but the ATO says I cant use the valuation, only the apportionment.
If the situation was reversed and it was my PPOR from day 1 and i rented it later, I could use the valuation. But the valuation doesnt work the other way around (that is, rented then PPOR).
I find this ridiculous that instead of using a mathematical linear apportionment, the ATO does not consider the use of the valuation when I property is rented then is used as a PPOR but only when it was originally your PPOR then is rented out.
Anyone been in this situation or know of other sections of the ITAA/cases where I can use the valuation?
Cheers
Daniel