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Edited version of private advice
Authorisation Number: 1052163515151
Date of advice: 31 August 2023
Ruling
Subject: Legal and beneficial ownership
Question
Will a capital gains tax (CGT) event occur when you transfer your share of the title of your investment property to your spouse?
Answer
No.
CGT event A1 occurs when there is a disposal of an ownership interest in a CGT asset.
A CGT event A1 may arise when the title of a property is transferred. You and your spouse purchased an investment property, with the property loan being held in joint names. It was always your intention for your spouse's name to be included on the property title, however due to an administrative error, your spouse's name was not included on the property title when settlement of the property occurred.
Based on the facts, the Commissioner accepts that in your circumstances, there has been no change in beneficial ownership, and a CGT event will not occur when you transfer your share of the property title to your spouse.
This ruling applies for the following periods:
Year ended 30 June 20XX
Year ended 30 June 20XX
Year ending 30 June 20XX
Year ending 30 June 20XX
Year ending 30 June 20XX
The scheme commenced on:
1 July 20XX
Relevant facts and circumstances
You own an investment property (the property).
On XX/XX/20XX, you purchased the property. The property has been used to produce income from this date.
Both your name and your spouse's names are listed on the property loan.
The property title is solely in your name.
You intended for your spouse's name to be on the property title.
On XX/XX/20XX, you notified your conveyancer and instructed them to add your spouse's name to the property title. Due to an error, the information was incorrectly recorded, and your spouse's name was missed off the title before the property settled.
You are considering a transfer of title to correct this error.
Neither you, nor your spouse have ever lived in the property.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 102-20
Income Tax Assessment Act 1997 section 104-10