Edited version of private advice

Authorisation Number: 1051989988406

Date of advice: 2 June 2022

Ruling

Subject: CGT - main residence exemption and the sale of vacant land

Question

Are you entitled to apply the main residence exemption to your disposal of the property and disregard the capital gain or loss you made on the disposal?

Answer

Yes.

Applying sections 118-115, 118-150 and 118-160 of the Income Tax Assessment Act 1997 to your circumstances, you are entitled to apply the main residence exemption to disregard any capital gain or loss you made when disposing of the property.

This ruling applies for the following period:

The year ended 30 June YYYY

The scheme commences on:

1 July YYYY

Relevant facts and circumstances

You acquired the property after 20 September 1985.

The property is less than two hectares in size.

You have not owned any other property while owning this property.

You moved onto the property straight after acquiring it and resided in a dwelling on the property (the original dwelling).

After the original dwelling became unliveable you built and moved into a shed on the property which you used in combination with your car.

You moved into a replacement dwelling on the property less than a year later.

Subsequently, the replacement dwelling was destroyed in a natural disaster.

You are in no position to build on the property and have now been put in the position of having to sell the property.

The contract for sale of the property was signed in MM/YYYY.

Settlement occurred on DD/MM/YYYY.

Relevant legislative provisions

Income Tax Assessment Act 1997 section 118-110

Income Tax Assessment Act 1997 section 118-115

Income Tax Assessment Act 1997 section 118-120

Income Tax Assessment Act 1997 section 118-150

Income Tax Assessment Act 1997 section 118-160