Private ruling: Capital gains tax - Real property
Published: February 2012
Ruling period: Year ended 30 June 2012
Date scheme commenced: 1 July 2011

Ruling: Q1: Does a capital gains tax (CGT) event occur when you acquire the interest in land owned by your child? | A1: Yes.


Relevant legislative provisions: Income Tax Assessment Act 1997 Section 104-10 | Income Tax Assessment Act 1997 Subsection 104-10(4) | Income Tax Assessment Act 1997 Section 108-5 | Income Tax Assessment Act 1997 Section 109-5

Reasons for decision: Summary: If there is a rearrangement of interests in the property this will cause a change of ownership to occur. When a change of ownership occurs, a disposal takes place, which means that CGT event A1 occurs under section 104-10 of the ITAA 1997 and 109-5 ITAA. In your situation, the other tenant in common will dispose of 3 shares in the property to you. As a result of this you will not be liable for any CGT as a disposal CGT event has not occurred.

Please check this edited version to be sure that there are no details remaining that you think may allow you to be identified. If you have any concerns about this ruling you wish to discuss, you will find our contact details in the fact sheet. | Relevant facts: You acquired property as tenants in common | The property consists of a house which was your main residence after 20 September 1985 until sometime later when the property was tenanted. | The property also has an external building which is attached to the main house | You have provided a document which forms part of, and should be read in conjunction with, this private ruling: | § Copy of certificate of title. | The following information has been obtained from this document | § There is only one title to the property | The property is held as tenants in common in a number of shares. | You will acquire 3 shares of the other tenant in common.