CGT exemption on existing IPS passed down?

Discussion in 'Accounting & Tax' started by TMNT, 20th Feb, 2017.

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  1. TMNT

    TMNT Well-Known Member

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    in this week or last weeks money, the age
    there is a Q and A on CGT exemption on passed down ips

    its unclear to me but its saying, if a property is transferred to an offspring and they live in it for a year as a ppor, then there is no cgt payable upon its sale

    is this correct? obviously stamp duty will be payable
     
    TMNT, 20th Feb, 2017
    #1
  2. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    Not correct because the cost base of the property for the beneficiary would be the cost base of the deceased.

    but could be true for pre-cgt property.

    And it could be true for an IP that later become the main residence of the deceased just before he or she died.

    No stamp duty either on the transfer from the deceased to the executor to the trustee to the beneficiary
     
    Terry_w, 20th Feb, 2017
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  3. Paul@PAS

    Paul@PAS Tax, Accounting + SMSF + All things Property Tax Business Plus Member

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    Inheriting a dwelling

    Note that there is a two year window available so that a person can inherit a property and rent it out and sell and they may not have to pay CGT even if it does increase in value in that period.

    This page also explains how to use the 6 year absence rule to double dip the main residence exemption.
     
    Paul@PAS, 20th Feb, 2017
    #3