CGT free on sale of PPOR with granny flat?

Discussion in 'Accounting & Tax' started by menty, 26th Oct, 2021.

Join Australia's most dynamic and respected property investment community
Tags:
  1. menty

    menty Well-Known Member

    Joined:
    29th Jun, 2015
    Posts:
    181
    Location:
    Sydney
    What are my CGT implications for the following situation?

    2011: PPOR bought and lived in
    2012: Granny flat built on PPOR
    2013-2016: Both PPOR and granny flat tenanted
    2016-Current: PPOR and Granny flat both lived in as PPOR (no tenants)

    If I was to sell the property, would I have to pay CGT, or would it fall under the 6 year rule
     
    menty, 26th Oct, 2021
    #1
  2. Terry_w

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

    Joined:
    18th Jun, 2015
    Posts:
    42,005
    Location:
    Australia wide
    not enough info. Could be either, get some tax advice
     
    Terry_w, 27th Oct, 2021
    #2
  3. Paul@PAS

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

    Joined:
    18th Jun, 2015
    Posts:
    23,554
    Location:
    Sydney
    The 6 rule cant be applied to a portion of a property that was a home but used to produce income. There is a need to consider the issues immediately prior to the tenancy. Hence in most instances some apportionmnet of the sale for the period while tennated is required. However, this is problematic to determine. s118.192 also applies. There are issues in the vague dates eg 2012 - 2013 that need to be understood for proper advice

    I would suggest it is a (semi) complex issue that needs personal tax advice.

    Yes. CGT will apply in some form. However when given the right advice it could even be eliminated.
     
    Paul@PAS, 27th Oct, 2021
    #3