Guest McLarenJoe

Capital Gains Tax situation

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    Guest McLarenJoe

    Firstly, great to have found this forum!!

    Have been in SA for a bit over 3 years now. Staying with relatives.

    Just sold our house in London.... for a good profit.. and starting to realise just how complicated the CGT issue is!!

     

    Am assuming no tax to pay in the UK as we live here for tax purposes..

     

    As I understand it, to calculate the CGT, I'll have to get a retrospect valuation from the day I moved to Oz..

    Then take 50% off.

    Then divide by 2 because we are joint owners.

    Then subtract the improvements and the costs of selling.

    And hopefully subtract our costs of going over there to get it ready to sell, flights, hotels etc.

    was in a bit of a state after being rented out for 3 years.

     

    Am I on the right track???

     

    My big question is.... I heard somewhere, seeing that I haven't bought another home,

    then I can class the place I was renting out in London as my home or residence or whatever, thus making it not liable for CGT.

    Is this total balls???

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    Guest Guest12727

     

    My big question is.... I heard somewhere, seeing that I haven't bought another home,

    then I can class the place I was renting out in London as my home or residence or whatever, thus making it not liable for CGT.

    Is this total balls???

     

    I vaguely recall reading something which indicates that this is unlikely as you were not resident in the country. I think you would need to spend a minimum numbers of weeks there per year to qualify for that one.

     

    Need some-one else though to confirm - relying on deep memories from somewhere unknown!!

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    Guest McLarenJoe

    I sincerely hope you're wrong!! To further clarify, what I'm having trouble finding out is if my Main Residence, under the 6 year rule, can be overseas??

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    Hello

     

    You calcs seem to be on the right track, not entirely sure about the full costs of going over there, maybe only partially depending if you also went over to see family/for a holiday as well.

     

    Yes there is a 6 year main residence exemption in place in Australia (https://www.ato.gov.au/General/Capital-gains-tax/In-detail/Real-estate/Treating-a-dwelling-as-your-main-residence-after-you-move-out/) and I believe that an overseas home can be taken into account.

     

    However I am not a Tax Adviser and so speaking to an Accountant about your personal situation is highly recommended.

     

    Regards

     

    Andy

    Edited by Andrew from Vista Financial

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    Guest McLarenJoe

    Thanks Andy, much appreciated.. it does seem I may not have to pay CGT after all! But am a bit worried that as I am calling the UK place my main residence, that I'll liable to UK tax??

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    Did you find an Accountant/Tax Advisor that knew the UK/Aus rules? I'm going to be faced with the same problem some time soon and want to know what i'm up for

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