Private ruling: Capital gains tax and main residence
Date of advice: 15 May 2018
Published: July 2018
Ruling period: Year ending 30 June 20XX
Date scheme commenced: 1 July 20XX

Ruling: Q1: Are you eligible to claim the main residence exemption on the sale of an adjacent structure that was sold concurrently with the main residence? | A1: Yes Having considered your circumstances and the relevant factors, you can fully disregard the capital gains tax under section 118-120 of the Income Tax Assessment Act 1997 . Further information on the relevant factors on ‘dwellings, structures and adjacent land’, can be found on our website ato.gov.au and entering Quick Code QC22169 into the search bar at the top right of the page.

Relevant facts and circumstances: In 20XX you purchased property as the sole owner and this dwelling was you and your family’s main residence. As you and your family were growing (X family members) you built an adjacent unit at the back of the property, which was used wholly for residential and private purposes. The family commenced occupying this unit from 20XX and both buildings continued to be used concurrently for meals, living and sleeping. The adjacent structure was not used to derive rent. You sold both buildings together on one title in 20XX, the contract date.

Relevant legislative provisions: Income Tax Assessment Act 1997 section 104-10 and | Income Tax Assessment Act 1997 section 118-120.