Private ruling: Capital gains tax - main residence exemption
Date of advice: 8 September 2020
Published: October 2020
Ruling period: 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 section 118-145 of the ITAA 1997 indefinitely as you did not use the dwelling for the purpose of producing assessable income.

Relevant facts and circumstances: You own a property (The Property). You purchased the property for $XX,000 many years ago with your spouse as tenants-in-common. The property is zoned for Primary Production; however, it has never been used for Primary Production. You own a property at XX, Suburb XX, State AA (The Property). You purchased the property for $XXX in 20XX with your spouse as tenants-in-common. The property is zoned for Primary Production; however, it has never been used for Primary Production. You have lived there since you purchased The Property with your spouse until a few years ago, at which time you both moved into rented premises due to declining health. The total property size is less than X hectares. There have been no improvements made to The Property. Council rates state that land use is residential. You plan to sell the property with the dwelling on it to your neighbour for $XXX. You expect to make a small capital gain on the sale of the Property

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


Assumptions made for the purposes of this ruling: You will exercise the absence choice in section 118-145 of the ITAA 1997 when you sell the Property.