Private ruling: Capital gains tax
Date of advice: 23 May 2024
Published: 1 July 2024
Ruling period: Year ended 30 June 2023
Date scheme commenced: 1 July 2022

Ruling: Q1: Did CGT event A1 happen to you due to the sale of the property? | A1: No. The Commissioner is satisfied that based on the information provided that a capital gains tax event relevant to you did not occur, as you were not the beneficial owner of the property. It is possible for legal ownership to differ from beneficial ownership. Where beneficial ownership and legal ownership of an asset are not the same, there must be evidence that the legal owner holds the property on trust for the beneficial owner. The Commissioner is satisfied that you held the property on trust for your child and you did not have a beneficial ownership in the property.

Relevant facts and circumstances: The property was purchased by your child and their ex-spouse as joint tenants. Your child's relationship broke down and as part of the settlement the property was to be transferred to them. You were required to go on the title as part owner as your child was on Centrelink payments and was not able to secure a loan in their own right. You did not pay any of the loan and did not contribute to the household expenses such as insurance rates etc. Your child paid all associated expenses relating to the property. The property was sold a number of months ago and you did not receive any of the proceeds from the sale.

Relevant legislative provisions: Income Tax Assessment Act 1997 section 104-10