• Consequences of roll-over

    Attention

    Warning:

    This information may not apply to the current year. Check the content carefully to ensure it is applicable to your circumstances.

    End of attention

    Where you transfer the asset

    Where you transfer the asset the consequences of roll-over are:

    • for assets acquired before 20 September 1985:
      any capital gain or capital loss is disregarded, and
    • for assets acquired on or after 20 September 1985:
      marriage breakdown roll-over enables you to disregard any capital gain or capital loss you make from the CGT event that involves you and the transferee spouse.

    Where the asset is transferred to you

    Disposal cases

    Assets acquired before 20 September 1985

    Capital gains tax does not apply to assets acquired before 20 September 1985. This means that if a CGT asset, including a share of a jointly owned asset, was transferred to you because of the breakdown of your marriage and it was acquired by the transferor before this date, you are also taken to have acquired the asset before that date and any capital gain or loss is disregarded.

    However, if you make a major capital improvement to that asset after 20 September 1985, you may be subject to capital gains tax when a CGT event happens to that asset (see Capital improvements to pre-CGT assets).

    Assets acquired on or after 20 September 1985

    The rules are different if the asset was acquired by the transferor on or after 20 September 1985. In this case, if you receive the CGT asset (or a share of a jointly owned asset) and there is a marriage breakdown roll-over, you are taken to have acquired the asset at the time you received it from your spouse (or the company or trustee).

    To calculate your capital gain or capital loss when a later CGT event happens, you will start with the same cost base or reduced cost base as your spouse (or the company or trustee) at the time of the transfer.

    Transfer costs incurred by your spouse (or the company or trustee), for example conveyancing fees and stamp duty, are included in the cost base.

    If you acquired the asset before 11.45am on 21 September 1999, you may be able to use the indexation method when calculating your capital gain.

    If you acquired the asset after 11.45am on 21 September 1999, you cannot use the indexation method when calculating your capital gain but you may be able to use the discount method.

    If you receive your spouse's share of property that you jointly owned, you are taken to have acquired that share of the property at the time it was transferred.

    Collectables or personal use assets remain collectables or personal use assets when they are transferred from your spouse (or the company or trustee) in the case of a marriage breakdown roll-over. For information about collectables and personal use assets, see What is a CGT asset?

    Creation cases

    As explained earlier, there are several instances where your spouse (or a company or trustee) may create an asset in your favour. The table below explains how to calculate the first element of your cost base or reduced cost base in each case.

    CGT event

    Cost base or reduced cost base

    Creating contractual or other rights (D1)

    Incidental costs incurred by the transferor that relate to the event

    Granting an option (D2)

    Expenditure incurred by the transferor to grant the option

    Granting a right to income from mining (D3)

    Expenditure incurred by the transferor to grant the right

    Granting a lease (F1)

    Expenditure incurred by the transferor on the grant renewal or extensions of the lease

    You are taken to have acquired the asset at the time specified by the CGT event. For example, for CGT event D1, you acquire the asset at the time you enter into the contract or, if there is no contract, the time the right is created. For more information, see the summary of CGT events at appendix 3.

    Last modified: 31 Aug 2010QC 16195