Private ruling: Capital gains tax
Date of advice: 2 August 2017
Published: November 2017
Ruling period: Year ended 30 June 2018
Date scheme commenced: 1 July 2017

Ruling: Q1: Will the transfer of legal title of the property from yourself to the beneficial owner result in a capital gains tax event? | A1: No A change in the legal ownership of an asset without a change in the beneficial ownership will not constitute a disposal for capital gains tax purposes (subsection 104-10(2) of the Income Tax Assessment Act 1997) . You are the legal owner of the property (your name is on the title deed), however you are not the beneficial owner (further information on the definition of a beneficial owner can be found in Taxation Ruling IT 2486 and Taxation Determination TD 92/106). The beneficial owner is your child. When you transfer title of the property from your name to your child’s name there are no capital gains tax consequences.

Relevant facts and circumstances: Your name was transferred to the title deed of the property owned by your child, for security purposes following a relationship breakdown. No money was transferred from you to your child; you had no financial interest in the property. You have not paid for the mortgage or invested in the property. You will transfer legal title from your name to your child’s name.

Relevant legislative provisions: Subsection 104-10(2) of the Income Tax Assessment Act 1997