Dispose of foreign PPOR

Discussion in 'Accounting & Tax' started by firststep, 8th Sep, 2019.

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  1. firststep

    firststep Member

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    Hi everyone,

    I am looking for some advice.

    A few years ago I acquired a foreign property while I was working overseas.
    I resided in that property from 2013 to 2017.

    I'm back in Australia now and plan to dispose the property.
    I know CGT is exempt as I haven't acquired another PPOR in Australia or anywhere else.

    Once I sell the property I plan to transfer the money back in one lump sum.
    I suspect ATO is going to want to know where that money came from and whether they are owed any tax on it.

    My question is how I should declare this information to the ATO.
    Do I let them know as soon as I do the transfer?
    Is it something I put in my tax return?
    Or do I wait for ATO to inquire about it and then explain?

    Thanks.
     
  2. Terry_w

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

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    If the property is CGT exempt there is no need to record it.
     
  3. Trainee

    Trainee Well-Known Member

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    Does the ppor cg exemption apply to non australian property?
     
  4. Mike A

    Mike A Well-Known Member

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    It can yes
     
  5. Terry_w

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

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  6. firststep

    firststep Member

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    Hi Terry, thanks for your replies.
    I'm an Aussie working overseas so I'm pretty sure CGT is exempt.

    If I don't do anything I'm 99% sure ATO will inquire about it.
    Was thinking whether it's easier if I contact them first.
     
  7. Trainee

    Trainee Well-Known Member

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    Why do you think this? Have you known people in this situation?
     
  8. Terry_w

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

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    You could be audited. But what have you got to fear? You are guilty until you prove you are innocent, but you can do that can't you?
     
  9. firststep

    firststep Member

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    Yep, I'll make sure I keep the relevant documents as proof.
     
  10. Paul@PAS

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

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    An exempt gain is reported as a choice at Item 18 in the return after it is sold. Likely $0 taxable. Its also possible that there could be a CGT loss !! (Think of the AUD value change) and NOT claiming the exemption may be wise.

    The most common way the issue is detected is with datamatching by Austrack when the $$$ come back. That not illegal and you may be asked to explain. Proceeds from the sale will be supported by paperwork. Easy.
     
  11. firststep

    firststep Member

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    Thanks Paul, that's what I plan to do.
    Appreciate your detailed response.