PPOR question regarding SRO Victoria

Early this year I purchased my first property in Victoria and obtained the 50% stamp duty discount. Now circumstances may force me to relocate interstate for work and if I do I may purchase another property to live in. My first home would then become an IP.

Now since this would happen before I have resided in my home for 12 months, does this mean I would have to repay my 50% stamp duty discount back to the SRO?

What I'm getting at is Can I keep my Victorian property as a PPOR and rent it out while living somewhere in another property that I would purchase?
 
The stamp duty concession rules and the CGT rules are dealt with by two distinct issues of law.

1. Duty is Vic law and OSR
2. CGT is Commonwealth - Tax law. (ATO)

I understand a repayment is required if you fail to complete the minimum term of residency. Call OSR and discuss. (no names).

For CGT you can choose (elect) which property is subject to the main residence exemption providing it is eligible. The most common form of eligibility is fact based. Did you reside in it ?? Based on your explanation I believe you would be eligible for either property to be considered for the MRE. Note that you cannot overlap and ONLY one at any time can be exempt. The MRE rules allow you to be absent for up to 6 years in some instances and retain the exemption. ...Its one OR the other. You decide at the time of the disposal of the first property. How you prepare your tax return is the election.

There may be a Vic land tax issue with the property but if its land value is under the threshold may not be an issue. There is a minimum residency period for a PPOR to be exempt for land tax.

I would recommend you consider what the value of the property is on the date it ceases to be your PPOR and commenced rents and record that opinion. Its the start value for a future cap gain under one method.,

This is an example of the benefits of retaining a good tax adviser.
 
Early this year I purchased my first property in Victoria and obtained the 50% stamp duty discount. Now circumstances may force me to relocate interstate for work and if I do I may purchase another property to live in. My first home would then become an IP.

Now since this would happen before I have resided in my home for 12 months, does this mean I would have to repay my 50% stamp duty discount back to the SRO?

What I'm getting at is Can I keep my Victorian property as a PPOR and rent it out while living somewhere in another property that I would purchase?

Paul's advice should get you through the CGT issue as SRO and ATO (CGT) are separate issues.

In relation to SRO, without going into specifics, there may be an issue here as it was my understanding that you must live in the property for a 12 month period commencing within 12 months of purchasing it.

However, with my second IP, we claimed the SD concession (intending to move in), property was vacant for 4 months, circumstances changed and we then rented it out, selling it 3 years later (split up with ex). We never had any repercussions from the SRO.

I would be interested to hear from other SS members to see if they have had any experiences where SRO have contacted them in relation to repayment of concession incorrectly claimed on SD.

Dave
 
Paul's advice should get you through the CGT issue as SRO and ATO (CGT) are separate issues.

I would be interested to hear from other SS members to see if they have had any experiences where SRO have contacted them in relation to repayment of concession incorrectly claimed on SD.

Dave

Hi Dave. I rang the SRO and explained that I may be forced to move. Now as long as this is still my Principle Place of Residence, I.E. I am still living here the majority of time, then there is no problem.

They also instructed that if I choose to rent the place out at any time before the first 12 months of ownership then I must contact the SRO and repay the stamp duty discount portion back.

Anyone else have any first hand experience here?
 
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