CGT on residence over 4.94 acres

I know it’s a bit late but I’m after any advice on how to minimise the CGT on a property we bought 8 years ago & have lived in for 7 of them. We recently rented it out

The property is on 10 ha (26 acres) with 1 house & 1 title.

We’re being advised that cgt is applicable once the property is sold, which was a shock to us thinking that it was our residence & cgt free.

The question is, how can we minimise the cgt once we have sold it.

Thanks
Gary

 

Choose the 2 hectares of the property with the most value. You will need a valuer to work out the portions.

Get some tax advice as well

 

Thanks Terry.

Would the capital gain be calculated any differently should we have remained occupation as opposed to renting it out?

We had a valuation done prior to renting it out.

 

Yes

 

How so?

 

Too much to go into. Get some tax advice

 

The tax adviser should give careful advice on this. The best 2HA that also includes the dwelling can be chosen. The balance on the land must be connected. ie Three creeks. But if the arae containing the three creeks and a rocky hill can be a separate area this may work.

 

that isn't accurate. the land does not need to be connected. refer https://www.ato.gov.au/law/view/document?DocID=TXD/TD199968/NAT/ATO/00001&PiT=99991231235958

 

Misworded. Skipped some words on a edit ... The dwelling must be part of the land that is exempt. Care should be taken with the area of the dwelling to maximise it and then to include other primary land. eg access areas, rail crossings etc. One farmer I know included a quarry as that was highly valued for roadworks and rail use. The balance of the land does not need to be connected but should be prime land. The taxable portion may ideally be poor land...ie Three creeks. . But if the arae containing the three creeks and a rocky hill can be a taxed area this may work.

A diligent walk around by a valuer will assist provided they understand the scope.