Hi there, have a tax question I currently have a PPOR in my name and my fiance-wife-to-be and I are looking to buy a PPOR to live in together. - Should the 2nd PPOR should be in my fiance's name only to take advantage of the CGT exemption? We will then have 2 PPOR's in that case - Are we even allowed to have 2 separate PPOR's once we are married? How would the ATO find out - Can we take advantage of the 6yr rule to move between PPORs?
If you are looking for a better way of ownership maybe you should read through @Terry_w tax tips It's always cheaper to get the structure right prior to purchase, rather than trying to fix it later There are reasons to have ownership in both names, and other reasons for property to be held be a trust Any reason why you both don't want to live in your current PPOR ? You could then use spare funds and borrowing capacity to buy an IP
Our tax laws are framed on self assessment. If the taxpayers gets it wrong the fraud and evasion rules apply. No time limits. penalties and interest are based on the degree of culpability and time. Both taxpayers would be liable. The ATO can have all sorts of reasons to detect it. eg sales data on the second one occurs. Then someone notes no CGT is calculated. The code for a main residence exemption must be used. Its missing. They ask more questions and see the spouse also sold another one a few years earlier and didnt report any taxable amount or claim exemption using the correct code. Its now an audit for two taxpayers. Risk aspects rise when either property has been rented. And OSR land tax data and other extrinsic data matching
thank you - will have a look. I was just wondering if you could have 2x PPORs for CGT exemption on both properties that's all, one in my name and the other one the mrs
Its wise to understand what the specific tax issues and dates are that apply to your respective case through personla tax advice that way you can each make sound choices and know what and how CGT will impact each property. Its not unusual to find three properties impacted. Her former home, your former home (both now Ips) and your new main residence. There are numerous choices but they can be limited by some conditions.
Don't doubt the data matching ability of the ATO either. I once bought a second property to live in temporarily whilst I went owner builder for renovating and extending my PPOR (as it had no floors, walls, ceilings, kitchen, bathrooms, water or sewer connections). The ATO didn't care that there is he house wasn't habitable, I could only have one PPOR. To add to the insult to injury, 6 months later when ready to move back to the original PPOR my partner called it quits (after an unfortunate personal incident ). So she continued to live in the second property at no cost until we could sell it, this dragged on for some time..... I continued to pay all outgoings for both properties until the second sold and we had a settlement. 6 months later the ATO send me another bill ! She had claimed rent assistance so the ATO wanted further amounts Too late to argue, had poor tax advice, so paid
