Tax Tip 52: Trusts and the main residence exemption for CGT

Discussion in 'Accounting & Tax' started by Terry_w, 11th Oct, 2015.

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  1. Terry_w

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

    9th Jun, 2006
    Australia wide
    Trusts and the main residence exemption for CGT

    Discretionary or Unit Trust owned properties do not get the main residence CGT exemption under section 118-110 of the ITAA 1997. This applies even if the residence is being used as the main residence of the trustee or a beneficiary of the trust.

    See the legislation below and note the bold bit below, s 118-110(1)(a) clearly states the exemption is only available for individuals.

    Note - there are limited exceptions such as for a special disability trust which can be exempt from CGT.

    Keywords: CGT; Trusts
  2. Paul@PFI

    [email protected] Tax Accounting + SMSF Business Plus Member

    18th Jun, 2015
    Vic has a land tax exemption for trusts when a beneficiary resides. Arguably its out-trumped by the CGT issue. I have seen trusts with issues which negate the CGT issue etc....Non-residents etc