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Taxation Determination

TD 92/173

Income tax: capital gains: does subsection 160ZZQ(9) require each spouse to have an interest in each dwelling referred to?

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FOI status:

may be releasedFOI number: I 1213475

This Determination, to the extent that it is capable of being a 'public ruling' in terms of Part IVAAA of the Taxation Administration Act 1953, is a public ruling for the purposes of that Part. Taxation Ruling TR 92/1 explains when a Determination is a public ruling and how it is binding on the Commissioner. Unless otherwise stated, this Determination applies to years commencing both before and after its date of issue.

1. No. A person may nominate, as a sole or principal residence, his or her spouse's dwelling even though that person has no interest in the spouse's dwelling.

2. There is nothing to prevent either spouse nominating the other's dwelling as a sole or principal residence so that a full exemption is obtained on the disposal of that dwelling.

3. The extended meaning of ownership of a 'dwelling' in subsection 160ZZQ(2) results in subsection 160ZZQ(9) not being limited to circumstances where a person has a legal or equitable estate or interest in land. A person with a right to occupy a house e.g. a residential tenant or mere licensee, has a 'dwelling' for the purposes of subsection 160ZZQ(9). A nomination should therefore be made if the role or principal residence of either spouse is, for example, rented from a third person.

Example:

A husband and wife each separately owns and occupies different post-CGT homes.
If the husband's home is likely to yield a larger capital gain on disposal, the wife may nominate her husband's dwelling so that subsection 160ZZQ(10) cannot apply to reduce his exemption by one-half. In these circumstances, there is no exemption in respect of the wife's dwelling.
Note: In this case, the spouses are not living separately and apart on a permanent basis (subsection 160K(2)).

Commissioner of Taxation
22/10/92

Previously Draft TD 92/D150

References

ATO references:
NO CGT Cell PRE

ISSN 1038 - 3158

Related Rulings/Determinations:

TD92172;
TD92174

Subject References:
Principal residence exemption;
interests in dwelling

Legislative References:
ITAA 160ZZQ(2);
ITAA 160ZZQ(9);
ITAA160ZZQ(10);
ITAA160K(2)

TD 92/173 history
  Date: Version: Change:
  22 October 1992 Original ruling  
You are here 29 November 2006 Original ruling + note Repeal provision note
  17 March 2010 Withdrawn  

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