CGT, room renting and selling at a loss

Hi. First time poster looking for general advice. I purchased PPOR for $600k 9 years ago. Early on I rented out a room for 4 years and declared the income and claimed expenses such as a portion of interest on my tax returns. It’s a 2 bedroom house so I claimed based on 50% of the floor space. Now thinking about upgrading to a bigger house but the home has lost value - prob get $550k for it now - located in Perth... I have also spent a bit upgrading it over the years. So my question is should I bother trying to work out a capital loss when I sell? I assume had the home gained in value I’d be up for a CGT bill, so feel like I should be able to book a capital loss to offset any future gains in other more fortunate investments.

 

Did you claim depreciation over the 4 years?

 

You must work out the CGT - Capital proceeds less the cost base.

 

If there is a CGT loss the strategy may be to not claim the main residence exemption as it is a choice. This may benefit you in future years to report a CGT loss. CGT losses on sale are a little more complex in your case as you are impacted by the pro-rata basis and some costs that some may tell you are eligible cant be used to create a loss, only reduce a profit. It may assist to seek personal tax advice to avoid errors. Remember for years after you USE that loss you may need to support how you determined the loss calculation. Get it wrong and it could pose a problem in 3, 5, 10 or more years

 

On a few things like a new water heater yes I did. Not the building though as it’s too old for depreciation.