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Edited version of your written advice
Authorisation Number: 1051291876626
Disclaimer
You cannot rely on this edited version in your tax affairs. You can only rely on the advice that we have given to you or to someone acting on your behalf.
The advice in the Register has been edited and may not contain all the factual details relevant to each decision. Do not use the Register to predict ATO policy or decisions.
Date of advice: 11 October 2017
Ruling
Subject: CGT application of absence rule
Question 1
Will you be eligible for a partial main residence exemption for a residential property under section 118-145 of the Income Tax assessment Act 1997?
Answer
Yes
You are eligible for a partial main residence exemption. As you have utilised this property for income producing purposes, the six year absence rule under section 118-145 of the Income Tax assessment Act 1997 allows you to treat it as your main residence for the period from June 200X to June 201X inclusive.
This ruling applies for the following period:
Year ending 30 June 2018
The scheme commences on:
1 July 2017
Relevant facts and circumstances
You purchased a property utilising this as your main residence.
Later you purchased a second property moving into this property.
The first property was rented.
You are electing to treat the first property as your main residence, by applying the absence rule for a six year period.
CGT will apply to the first property for the period post the six years.
CGT will apply on the second property from purchase date until the end of the six year election.
Relevant legislative provisions
Income Tax Assessment Act 1997 Section 102-20
Income Tax Assessment Act 1997 Section 104-10
Income Tax Assessment Act 1997 Subdivision 118B
Income Tax Assessment Act 1997 Section 118-145
Income Tax Assessment Act 1997 Section 118-185
Income Tax Assessment Act 1997 Section 118-190
Income Tax Assessment Act 1997 section 118-192
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