Confusion with six year rule

Hi there,

I'm from Sydney and recently just purchased an OTP apartment, it is my first home and I did not purchase it using a mortgage/loan.
I can't seem to find any information online with the situation I'm in and hoped some of you could help me out.
As I was filling out my Purchaser/Transferee Declaration (stamp duty form) it asked me "Do i intend to occupy this property as your principal place of residence" .
The thing is, is that I reside overseas with my partner already so I intend to lease it out once the settlement is done (mid november) BUT I intend to eventually move back to Sydney and live in it for the required amount of time to avoid CGT if I did decide to sell one day.

So my question is, can i tick YES it is my PPOR even though I intend to lease it out once settled and then have the intention to live in it later on sometime within the 6 years?

If this is possible, how long is the minimum required time to live in before I can repeat the 6 year rule again?

Or Do I have to tick NO and then when I do decide to move back have it changed to PPOR and still have to pay the full CGT if I did decide to sell

Thank you

 

Thats not how the 6 year rule works.

 

You should seek personalized specific tax advice.

 

No, you actually have to live in it. If you then move out, you can then continue to say its your ppor for up to 6 years, provided you don't have another ppor during that time.

Being that you live overseas adds a layer of complexity you should probably get proper advice about.

And the fact you bought it with no loan is irrelevant to the question.

 

ATO Linky thingy

 

You are confusing at least two issues.

State laws relating to stamp duty, land tax and land tax surcharge.
Commonwealth Income Tax Law - Income Tax Assessment Act 1997

When a person completes a land transfer these q's get asked to determine the USE of the property by the buyer/s. It does not act as anything of a declaration or a election at that time. It is a question of fact.

If you do not intended to reside in the property when it is first acquired it cannot and is not a principal place of residence. That is a land tax and state stamp duty expression. A non-resident person cannot choose for a property to be their residence if they are non-resident unless they actually occupy the property.

Same applies for the CGT main residence exemption. It only commences when you do actually occupy the property with your family and your possessions. Only when that occurs can a person they leave the property and the six year absence rule maintains the exemption from CGT.

You should be aware the government has a proposal to alter the CGT rules to prevent any person who is non-resident from choosing the CGT exemption. Its implementation is not opposed by other parties.

You should seek legal advice as you could make a false declaration subject to penalties. Legal advice should be given on the duty, land tax, land tax surcharge and income tax aspects of the purchase.

 

If you don't live in it you cannot use the 6 year rule. mere intention to live at some point doesn't count.