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Edited version of private advice
Authorisation Number: 1051810685149
Date of advice: 1 March 2021
Ruling
Subject: Capital gains tax - transfer ownership interest on property title
Question
Will there be a capital gains tax (CGT) event when you transfer your interest in the property to Person A?
Answer
No. CGT event A1 happens when you dispose of a CGT asset. The beneficial owner of the CGT asset will be liable to determine the capital gain or loss from the event. We accept the beneficial owner is different to the legal owner. The beneficial owner since the property was acquired has been Person A. When the property is disposed of CGT event A1 will occur for the beneficial owner. Further information on a beneficial owner can be found in Taxation Determination TD 2017/11 Income tax: who should be assessed to interest on bank accounts?.
This ruling applies for the following period:
30 June 20XX
The scheme commences on:
1 July 20XX
Relevant facts and circumstances
The property was purchased in XXXX.
You and Person A obtained finance to purchase the property where you werelisted as a joint borrower to facilitate the purchase of the property by Person A.
Person A paid the initial deposit to purchase the property.
The title of the property is held as joint tenants with Person A.
Person A has always paid for the mortgage payments and the expenses relating to the property such as rates, water, electricity and gas.
You have not contributed to any expenses associated with the property and have not received any rent.
The property has always been used as Person A's main residence and you have never lived in it.
On XXXX you transferred your interest in the property to Person A.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 102-20
Income Tax Assessment Act 1997 section 104-10
Income Tax Assessment Act 1997 section 108-5