Income tax: capital gains: is the main residence exemption relevant when the proceeds of sale of a dwelling are treated as income under ordinary concepts?
Please note that the PDF version is the authorised consolidated version of this ruling and amending notices.This document has changed over time. View its history.
FOI status:may be releasedFOI number: I 1213055
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, the Determination applies to transactions entered into both before and after its date of issue.
[Note: This is a consolidated version of this document. Refer to the Tax Office Legal Database (http://law.ato.gov.au) to check its currency and to view the details of all changes.]
1. No. In cases where the sale of a dwelling gives rise to income under section 6-5 of the Income Tax Assessment Act 1997 (ITAA 1997), for example. as part of a business or from an isolated profit-making transaction, that income remains assessable even if a main residence exemption is available for CGT purposes.
Example : A builder constructs a spec home in which he and his family reside while construction proceeds on another spec home. Any profit on sale which gives rise to income is fully assessable to the builder even if a main residence exemption is available for CGT purposes.
Commissioner of Taxation
NO CGT Cell PRE
main residence exemption;
income under ordinary concepts