Thank you so much for this episode. The questions that Tod followed up with were exactly what I wanted to know. My situation is quite complex, but I’ve already called the ATO a few times to clarify things. I only have one primary residence, but I decided to rent it out after settlement, intending to move in later when my parents come to live with me. Before the tenants moved in, I realized I made a wrong decision, but since I had already signed the lease, I couldn’t back out. After the lease ended after one year, I didn’t move in coz I thought it's no capital gain growth so no CGT and didn’t do so until 5 years later when COVID hit and price went up. I lived there for a year, then moved out and continued renting it. Now I’m using the 6-year rule to rent it out but still retain the primary residence status. However, if I sell in the future, I’ll have to pay a certain amount of the capital gains tax, and there’s no way to avoid it. The ATO told me I can’t hire an assessor when I moved in because I rented it out before living in it (if live in first and rent out, you could assess it), so I can only reduce the CGT based on the proportion of time it was my primary residence. So now I feel quite passive, since the property is in Sydney, I might never sell it because of the high capital gains tax, and only take out the equity. I want to tell those who only have one property: if the property is in the same city, consider living in it for a few months first to avoid losing tens of thousands of dollars in the end.
Thanks mate. Great topic! With the 6 year rule, can you be exempt if you live in the property for 12 months, anytime within that 6yrs? If you decide to use it as investment as soon as you purchase and then as you PPOR for 12 month after, say 3yrs.
This is a great question, I'll see if I can get Jez to jump in an answer it. Just incase he cant I'll link his website below if you'd like to reach out mate khipartners.com.au/
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What's the biggest take away you got from this to reduce your CGT? We'd love to hear if there's anything else you want covered on the subject
Great Ep, explained clear and concisely. Thank you!
Glad you enjoyed it mate!
Something to note, the carry forward contributions are only available if your super balance is below $500K.
Great insight mate 🙌🏼
Thank you so much for this episode. The questions that Tod followed up with were exactly what I wanted to know.
My situation is quite complex, but I’ve already called the ATO a few times to clarify things.
I only have one primary residence, but I decided to rent it out after settlement, intending to move in later when my parents come to live with me. Before the tenants moved in, I realized I made a wrong decision, but since I had already signed the lease, I couldn’t back out. After the lease ended after one year, I didn’t move in coz I thought it's no capital gain growth so no CGT and didn’t do so until 5 years later when COVID hit and price went up. I lived there for a year, then moved out and continued renting it. Now I’m using the 6-year rule to rent it out but still retain the primary residence status. However, if I sell in the future, I’ll have to pay a certain amount of the capital gains tax, and there’s no way to avoid it. The ATO told me I can’t hire an assessor when I moved in because I rented it out before living in it (if live in first and rent out, you could assess it), so I can only reduce the CGT based on the proportion of time it was my primary residence. So now I feel quite passive, since the property is in Sydney, I might never sell it because of the high capital gains tax, and only take out the equity.
I want to tell those who only have one property: if the property is in the same city, consider living in it for a few months first to avoid losing tens of thousands of dollars in the end.
Wow thanks mate! Really glad you got so much out of it 🙌🏼
Thanks mate. Great topic! With the 6 year rule, can you be exempt if you live in the property for 12 months, anytime within that 6yrs?
If you decide to use it as investment as soon as you purchase and then as you PPOR for 12 month after, say 3yrs.
This is a great question, I'll see if I can get Jez to jump in an answer it. Just incase he cant I'll link his website below if you'd like to reach out mate
khipartners.com.au/
He didnt get the George Orwell reference but great video none the less.
Haha yeah sometimes the references get a little off topic