Private ruling: Main residence exemption - foreign property
Date of advice: 1 February 2021
Published: March 2021
Ruling period: Year ended 30 June 20XX
Date scheme commenced: 1 July 20XX

Ruling: Q1: Can you disregard any capital gain made on the sale of your property? | A1: Yes. You are able to disregard any capital gain you will make on the sale of your main residence in accordance with section 118-110 of the Income Tax Assessment Act 1997 (ITAA 1997). You can continue to treat your dwelling as your main residence in your absence in accordance with subsection 118-145(2) of the ITAA 1997 if you use part of the dwelling that was your main residence for the purpose of producing assessable income, the maximum period that you can treat it as your main residence under this section while you use it for that purpose is six years.

Relevant facts and circumstances: You are a Country A citizen. You purchased a property in Country A in May 20##, which was your principal place of residence until you moved to Country B. Whilst you were living in Country B you commenced using the Country A Property for income producing purposes until its sale. In January 20## you migrated to Australia and became a permanent resident of Australia. You did not own any other principal place of residence. You disposed of the Country A property in December 20##, which you made a capital gain.

Relevant legislative provisions: Income Tax Assessment Act 1997 , section 118-110 | Income Tax Assessment Act 1997 , section 118-145