Private ruling: Capital gains tax and main residence exemption
Date of advice: 4 April 2019
Published: May 2019
Ruling period: Year ending 30 June 2019
Date scheme commenced: 1 July 2018

Ruling: Q1: Can you apply the full main residence exemption on the disposal of your interest in a property and disregard the capital gain? | A1: Yes. Under the current law, both residents of Australia for tax purposes and foreign residents are able to claim the main residence exemption when they sell property in Australia. As you have not had an interest in any other dwelling as your main residence and you have considered the dwelling to be your main residence during the ownership period you are entitled to claim the full exemption.

Relevant facts and circumstances: You were a resident of Australia for tax purposes when you purchased a property in conjunction with your sibling after September 1985. The size of the property is less than 2 hectares. You each own 50% of the property. You resided in the property for several years before moving overseas and becoming a non-resident of Australia for tax purposes. The property was leased for a few years. Your sibling moved back into the property after the tenants vacated and has remained living there while you have remained overseas. You do not own any other residential property and continue to treat the property as your main residence. You are considering selling your share of the property by the end of the financial year.

Relevant legislative provisions: Income Tax Assessment Act 1997 section 118-100