Keeping records for an inherited main residence

If you inherit a dwelling that was the main residence of the person who left it to you, any capital gain on its subsequent disposal may be exempt. However, until you're sure of the circumstances, you should keep records of relevant costs incurred by you and the previous owner, or their trustee or executor.

You won't need to keep records of the previous owner’s costs if:

  • you inherited the dwelling after 20 August 1996
  • the dwelling was their main residence just before they died, and
  • they were not using the dwelling to produce income at the time of their death.

In these circumstances, you'll be taken to have acquired the dwelling at its market value at the date of death. If the executor or trustee has had it valued, get a copy of that valuation report. Otherwise, you'll need to get your own valuation.

Last modified: 18 Feb 2016QC 22171