• Legal database
Legal database
Disclaimer
This edited version has been archived due to the length of time since original publication. It should not be regarded as indicative of the ATO's current views. The law may have changed since original publication, and views in the edited version may also be affected by subsequent precedents and new approaches to the application of the law.

You cannot rely on this record in your tax affairs. It is not binding and provides you with no protection (including from any underpaid tax, penalty or interest). In addition, this record is not an authority for the purposes of establishing a reasonably arguable position for you to apply to your own circumstances. For more information on the status of edited versions of private advice and reasons we publish them, see PS LA 2008/4.

Edited version of your written advice

Authorisation Number: 1012930614598

Date of advice: 21 December 2016

Ruling

Subject: The validity of a market valuation

Question 1

Can you use the midpoint of the supplied property appraisal, as the market value of your property for the purposes of calculating the CGT discount as a non-resident who owned the property before 8 May 2012?

Answer

Yes

This ruling applies for the following period:

1 July 20XX to 30 June 20YY

The scheme commences on:

1 July 20XX

Relevant facts and circumstances

This ruling is based on the facts stated in the description of the scheme that is set out below. If your circumstances are materially different from these facts, this ruling has no effect and you cannot rely on it. The fact sheet has more information about relying on your private ruling.

You acquired the property at a location (the property) prior to 8 May 2012.

You were a non-resident of Australia on or after 8 May 2012, and the whole time between then and the sale of the property.

You obtained a market appraisal from a real estate agent on or after 8 May 2012 estimating a value for the property in a small range.

The real estate agent is appropriately qualified and has inspected and appraised the property in reaching these conclusions about the market value of the property.

You sold the property in the 20XX income year and made a capital gain.

Relevant legislative provisions

Subdivision 115-A of the Income Tax Assessment Act 1997

Subdivision 115-B of the Income Tax Assessment Act 1997

Section 115-105 of the Income Tax Assessment Act 1997

Section 115-115 of the Income Tax Assessment Act 1997

Reasons for decision

Some of the things listed in the ATO valuation guidelines that the ATO will look at when evaluating a valuation include that it should be:

    • explained well enough to understand how the valuation was reached;

    • contemporary;

    • understandable;

    • undertaken by a qualified or experienced person.

Your valuation is contemporary, having been done on the day in question. The valuer gives a description of how they came to their conclusion. The given range of the valuation is relatively small compared to the overall value of the property. The midpoint valuation appears reasonably reflective of the market value of the property as at 8 May 2012.

Accordingly, in this particular case, for the purposes of calculating your eligibility for the CGT discount, the Commissioner is prepared to accept this as a valid market valuation.


Back to top