Private ruling: Capital gains tax - main residence
Ruling period: Year ended 30 June 2011. | Year ended 30 June 2012.
Date scheme commenced: 1 July 2010.

Ruling: Q1: Can you choose to continue to treat a dwelling as your main residence during the time you have moved out and is used to produce income? | A1: Yes.


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

Reasons for decision: Detailed Reasoning - Main residence exemption: Generally, you can ignore a capital gain or capital loss from a CGT event that happens to a dwelling that is your main residence. However in order to obtain the full exemption from CGT, the dwelling must have been your main residence for the entire period you owned it. | Detailed Reasoning - Continuing main residence status after a dwelling ceases to be your main residence: In some cases, you can choose to continue to have a dwelling treated as your main residence even though you no longer live in it. You can only make this choice for a dwelling that you have first occupied as your main residence. If you do not use the dwelling to produce income, you can continue to treat the dwelling as your main residence for an unlimited period after you cease living in it. Where you use the dwelling to produce income, you can choose to continue to treat it as your main residence while you use it for that purpose for up to 6 years each time the dwelling again becomes, and then ceases to be, your main residence. If you make this choice you cannot treat any other dwelling as your main residence for that period (except in limited circumstances when moving from one main residence to another). In this case, you and your family will be moving out of your main residence for several years. The dwelling will be rented out during this time. As the dwelling will be used to produce income, you can choose to continue to treat the dwelling as your main residence for up to six years after you have moved out.

Please check this edited version to be sure that there are no details remaining that you think may allow you to be identified. Contact us at the address given in the fact sheet if you have any concerns. | Relevant facts: You own a dwelling that is your main residence. | You and your family will be moving out of this dwelling for several years. | While you and your family are living elsewhere, the dwelling will be rented out. | You will be returning to the dwelling after several years.