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Land Tax and CGT consequences of PPOR holiday let

Discussion in 'Accounting & Tax' started by wategos, 7th Apr, 2016.

  1. wategos

    wategos Well-Known Member

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    Thinking of holiday letting 4-6 weeks a year PPOR over Xmas/NY period.
    I understand this would have a pro-rata effect on CGT exemption if I ever sold ? Not sure though. Say I holiday let for a total of 2 years out of 20 years ownership would I be taxed on just 10% of the capital gain ?
    And Land Tax (NSW)... still exempt or something liable there ? Any consequences for being let on the last day of the year ?
     
  2. Terry_w

    Terry_w Structuring Broker and a Structuring Lawyer Business Member

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    CGT - would depend on the circumstances, you may use the 6 year rule to be exempt.

    Land tax has a concession from absences of the PPOR. Much stricter than the income tax laws. see clause 8 of Schedule 1A LMA:
    LAND TAX MANAGEMENT ACT 1956 - SCHEDULE 1A
     
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  3. Scott No Mates

    Scott No Mates Well-Known Member

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    As you are absent from the ppor and renting the place on the census date (midnight 31/12) are you going to be liable for land tax?
     
  4. wategos

    wategos Well-Known Member

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    ok thanks... it looks like it is probably exempt from land tax according to that clause if you went for a holiday elsewhere and returned. The xmas period is quite lucrative so was looking at it from an extra income perspective.