Private ruling: Capital gains tax
Date of advice: 20 June 2018
Published: August 2018
Ruling period: Year ending 30 June 20xx | Year ending 30 June 20xx
Date scheme commenced: 1 July 30 June 20xx

Ruling: Q1: Can you use the 50% capital gains tax (CGT) discount method to calculate your capital gain on the disposal of your property? | A1: Yes Having considered your circumstances you can use the 50% capital gains tax (CGT) discount method to calculate your capital gain on the disposal of your property. Further information on the discount method of calculating your capital gain generally can be found on our website ato.gov.au and entering Quick Code QC17159 into the search bar at the top right of the page.

Relevant facts and circumstances: You bought a block of land in November 20xx with the intention of building your home. You exchanged a contract in November 20xx and settled in October 20xx. In October 20xx you signed a contract with a builder to build a house on your vacant land. Construction is almost finished and you are going sell your house in the next couple of months as soon as final construction phrase is complete. You have decided to sell the property now as the area is not suitable for your family and the costs of holding the property is financial burden you can’t afford at this time and have decided to sell rather than hold on to the property. You have a contract for the property but it’s not yet signed.

Relevant legislative provisions: Income Tax Assessment Act 1997 Section 100-20 | Income Tax Assessment Act 1997 Section 100-25 | Income Tax Assessment Act 1997 Section 115-10 | Income Tax Assessment Act 1997 Section 115-20 | Income Tax Assessment Act 1997 Section 115-25