CGT Tax on Jointly owned IP

Hi All,

I am trying to work get my head around CGT..

Lets says an investment property is owned by a husband and wife, which they sell making a profit of $200k (after all costs). The property has been owned for 5 years therefore gets a 50% discount. The husband has a taxable income of $100k, the wife has a taxable income of $0.

Given the above information..

They will only be taxed on $100,000 (as they have owned the property for over 12 months, therefore get 50% discount on the $200,000 profit).

The property is jointly owned, therefore the wife (who has a taxable income of $0), does not pay tax on her portion of $50,000.

How will the husbands $50,000 get taxed?

Cheers,
Robbie

 

Just realized the wife wont pay $0 tax as the $50,000 profit gets added as her taxable income, therefore she would fall into the "$37,001 – $87,000" tax bracket.

 

Half of the nett capital gain will be added to the taxable income of husband and wife for the financial year in which the sale contract is signed.

So husband will have the $50K added to any other income in that year, as will the wife (even if $0 employment income there may be interest or dividends). Probably bump each up a tax bracket.
Marg

 

So to give a rough idea of how the $50k will be taxed:

Husband: 37c for each $1 of the $50k, so about $18,500
Wife: $3,572 plus 32.5c for each $1 over $37,000, so about $7,797

Thats sound about right?

 

Depends on other income.
If both husband and wife stay below $87K (top of that bracket?) you are probably right.
Marg

 

Plus 2% medicare levy for each taxpayer. Add $2000
+ medicare levy surcharge etc... may also apply. etc The issue could also affect other entitlements eg FTB. Help debt repayments etc