Principal place of residence, exemption on CGT

[HomeBuy]

Hi All ,

Can anyone explain how long someone would have to stay at their Principal place of residence within the 6 years of ownership in order to be exempt from CGT when selling?? Or how long in total they have to occupy the property for? I've visited the ATO site and it's a bit vague...

I bought my house in April 2004 and moved straight into it for 6 months in order to receive the FHOG. Since then I've been living with my parents and also spent a few months living/working interstate. My house has been occupied by tenants ever since, but would like to either demolish and build on it to live in future or sell it in a couple of years time. I've been told by several that I need to move back in to my house for another 6 months and by another for 3 months before the 6 years is up from when I first purchased the house to avoid CGT when I sell.
I also bought another IP this year in August but have never lived there myself.

Thanks and I hope someone can share some knowledge with me on this.
HomeBuy

 

[chrispy]

The way I understand it is CGT is pro rata for the time the property is let.

Chris

 

[Y33]

This is one of those areas you always get different interpretation of the rules.

I was informed by the ATO (Darwin) that I could rent out for 6 years before any CGT would need to be paid, but if I moved back in and then rented out again later I would get another 6 years exemption.

But when a check was done with ATO (Melbourne) they said it was 6 years combined total. If I rented for 5 years and moved back and then rented out again later for 2 years then that was 7 years combined so CGT applied but only from the time the 6th year ended. It was suggested to get a valuation done then as CGT would only apply from this time.

Absolutely have no idea which one is correct.

I have found it very hard to get a straight answer on this on a number of forums.

 

[Propertunity]

This is one of those areas you always get different interpretation of the rules. Absolutely have no idea which one is correct.
I have found it very hard to get a straight answer on this on a number of forums.

Yep, agreed and its even harder at present with the ATO web-site down.
One lady who would know is Julia Hartman from Bantacs. I see from her web-site she'll answer any Q like this for $39.95 (must have gotten sick of doing it on here for free )
www.bantacs.com.au

 

[HomeBuy]

Thanks Y33 on your information.
I think I should call the ATO in Melbourne to explain my scenario and ask for some guidelines. Or else go and visit an accountant, to minimise my tax requirements.

I want to get it right so that I don't have to pay unncessary tax when selling my house.

Happy New Year Everyone!