Question surrounding CGT and 6 year rule

Hi everyone,

I am looking for some clarification around cgt in the sale of a property. I want this information to do some calculations of my ownbit I understand that it maybe too detailed a request.

Due to a change in work location we need to sell our home after living in it for 2 years. We moved into it from a property that we kept and are using as an investment property for now.

I want to know what we can include in the cost base of this house when it is sold. I can think of:

Cost of house (yes)
Conveyancing fees (purchase and sell) (yes)
Agents fees (yes)
Capital works (maybe? You can on investment properties I think, but maybe not here)
Stamp duty (maybe? You can on investment properties I think, but maybe not here)
Interest (I wish but I do not think we can)
Rates (I wish but I do not think we can)

Am I correct with the above list? Any help or advice or suggestions to read for further information would be greatly appreciated.

If we can make a capital loss (or a tiny capital gain) then we won't claim this property as our primary place of residence for this time. In the same vein, of we choose to do that does that mean we would need to pay the extra stamp duty as it is not being classed as our primary residence at a federal level? I don't want to do the wrong thing, I just don't want to pay extra tax.

Thank you for your time

 

Yes to all those.

Stamp duty is only charged on the purchase and you did live in it.

 

Get advice. You might be able to salary package the agents commission on the sale of your existing house and stamp duty on the purchase of the new one (among other things).

The following link is the law regarding this area


SECTION 58C - EXEMPT BENEFITS - SALE OR ACQUISITION OF DWELLING AS A RESULT OF RELOCATION

Terry is correct. If you live in a house and it incurs a loss you cannot elect for it to NOT be your main residence.

 

Thanks for the information around salary sacrificing but unfortunately that does not apply to us - we chose to change jobs. It may be useful to know about in the future.

The quoted bit was interesting. Disappointing but interesting. I haven't seen people mention it before and I can't find it in the consumer friendly sections of the ATO website. I'll have to go looking through the legislation. We will get professional advice to Max/Min our gains and losses but it won't change the decision.

Thank you both for the helpful replies.

 

If you have a new employer, they could also pay certain relocation costs.

It is tax deductible to them and the benefits are exempt income to you.