Private ruling: CGT - cost base
Date of advice: 15 August 2025
Published: 20 October 2025
Ruling period: Year ended 30 June 20XX
Date scheme commenced: XX 20XX

Ruling: Q1: Can you include the costs of owning your investment property in the third element of the cost base of under subsection 110-25(4) of the Income Tax Assessment Act 1997 (ITAA 1997)? | A1: Yes. The property was not used to produce assessable income at any time. Therefore, you can include interest expense and costs of owning and maintaining the property in the third element of the cost base of the property under subsection 110-25(4) of the ITAA 1997.

Relevant facts and circumstances: You and your spouse purchased a land for investment purpose. You built a dwelling on this land (the property). On XX 20XX, you signed the contract of sale to sell the property. On 17 April 2024, the property was settled. During the ownership period, you incurred the interest on home loan expense, council rates, water, gas. You did not use the property to produce assessable income at any time.

Relevant legislative provisions: Income Tax Assessment Act 1997 subsection 110-25(4)