Private ruling: CGT - main residence exemption
Date of advice: 14 May 2026
Published: 27 July 2026
Ruling period: Year ending 30 June 20XX | Year ending 30 June 20XX
Date scheme commenced: 1 July 20XX

Ruling: Q1: Can you disregard any capital gain or loss on the transfer of your share of the property? | A1: Yes.

Relevant facts and circumstances: On Date one, you and your sibling purchased a property (the property). You own the property as joint tenants. You moved in as soon as practicable after purchasing the property. On date 3, you moved out of the property. After moving out of the property, you moved in with your parent to care for them. You have listed your parent's address as your mailing address for many years. You will transfer your share of the property to your sibling for no consideration.

Relevant legislative provisions: Income Tax Assessment Act 1997 section 104-10 | Income Tax Assessment Act 1997 section 118-110 | Income Tax Assessment Act 1997 section 118-140 | Income Tax Assessment Act 1997 section 118-145

Reasons for decision: Summary: You can disregard any capital gain or loss on the transfer of your interest in the property. | Detailed Reasoning - Detailed reasoning: Section 118-110 of the Income Tax Assessment Act 1997 (ITAA 1997) provides that you can disregard a capital gain or capital loss made from a capital gains tax (CGT) event that happens to a dwelling that is your main residence. To qualify for full exemption, the dwelling must have been your main residence for the whole period you owned it, the ownership period, and must not have been used to produce assessable income. Section 118-145 of the ITAA 1997 extends the main residence exemption by allowing you to choose to continue to treat your main residence as your main residence during a period of absence (sometimes known as the absence choice). The dwelling must first qualify as your main residence before you can exercise the absence choice. No other dwelling can be treated as your main residence during the absence (except where section 118-140 which is about moving between two dwellings applies). Where you use your property to produce assessable income, the maximum period you can exercise the absence choice for is 6 years. Where you don't use your property to produce assessable income, you can exercise the absence choice indefinitely. | Detailed Reasoning - Application to your circumstances: You moved into the property as soon as practicable and occupied it as your main residence. You moved out of the property on Date 2 and moved in with your parent to care for them. As you never used the property to earn assessable income, you can exercise the absence choice to extend the main residence exemption after you moved out of the property until the time that you transfer your share of the property to your sibling. You meet the conditions for a main residence exemption and can disregard any capital gain or loss on transfer of your share of the property to your sibling.