Joint Tenants - One living in house

[sydprop]

Hi.

Interesting scenario, say we have a property that is 50/50 joint ownership but one party lives in the property (pays market rent for the other 50%) and the other party does not live in the property. Can it be treated as an IP for the owner not living in the property?

Cheers

 

[Rob G.]

An interest in a CGT asset is itself a CGT asset.

I am assuming the property was not inherited.

While not physically living there, it is hard to argue the main residence exemption unless there is a legal deeming that it is your main residence.

If they initially established it as their main residence then the absence rule s.118-45 *might* allow the absent person to nominate that property (their share) as their main residence for up to 6 years after vacating providing you don't claim any other property as your main residence.

If it was merely an IP from the start for the absent person, then no main residence for them.

It all depends on specific details to your situation, so don't use this as a substitute for appropriate advice.

Cheers,

Rob

 

[sydprop]

Reviving my own old thread (not a great habit!)

Does anyone know if the non-resident owner can sign a lease for half the house and treat rent/interest/costs as an IP? Obviously there are CGT implications of this.