Keeping records of costs associated with your home
Even though your family home is usually exempt, you should try to keep all records relating to it, just as you would for other items of real estate. If the property ceases to be fully exempt at some time in the future, you may need to know its full cost so that you do not pay more CGT than necessary. If you do not have sufficient records, reconstructing them later could be difficult.
You need to keep:
- a copy of the purchase contract and all receipts for expenses relating to the purchase of the property - for example, stamp duty, legal fees, survey and valuation fees
- all records relating to the CGT event and all relevant expenses - for example, the sale contract and records of legal fees and stamp duty, and
- records of your costs of owning the property, and
- records of capital expenditure on improvements and maintaining title or right to it during your period of ownership.
Examples of costs of owning real estate include interest, rates and taxes, insurance premiums and the cost of repairs such as replacing broken items. (You will only be able to include these costs if you acquired your home after 20 August 1991, and have not and cannot claim a tax deduction for them.)
Capital expenditure on improvements may include extensions, additions or improvements, including initial repairs.
These costs form part of the cost base, which you use to work out whether you have made a capital gain or capital loss when the CGT event happens.
If the property is your home and you use it to produce income (such as by renting out part or all of it), you will need to keep records of the income-producing period and the proportion of the property used to produce income.
Since 20 August 1996, if you use your home for income-producing purposes, the first time you do this you are taken to have acquired the home at that time for its market value. You use the market value as your acquisition cost to work out a capital gain or capital loss at the time of any subsequent CGT event. You will need to keep details of expenses relating to your home after the date it started producing income.
Records held by former spouse
If CGT rollover applies to a home transferred to you because your marriage or relationship breaks down, make sure you get any records you need from your former spouse (or the company or trust that owned it), including records that show:
- how and when they acquired it, and
- its cost base when they transferred it to you.
If marriage or relationship breakdown rollover applies to the transfer of a property that was your former spouse's home and it was transferred to you under a CGT event that happened after 12 December 2006, make sure you also get a copy of records from them that show:
- the extent (if any) to which they used it to produce income during their ownership period - for example, the periods it was rented out or available for rent and, the proportion of the dwelling that was used for that purpose, and
- the number of days (if any) it was their main residence during their ownership period.
You will need these records to show you are entitled to the main residence exemption for the whole period (starting from when your former spouse became owner of the property). If you can't show this, you will be liable for capital gains tax on periods that it may have qualified for exemption.
Sections within Your home and other real estate
Last Modified: Wednesday, 30 January 2013