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Post by quambie on Oct 18, 2011 12:13:19 GMT 8
Ok as you know I have this place on the market. Today I have just found out that if you have more than 2.5 Hectors around 6 acres you are up for capital gains tax that was a shock if you bought for 400,000 sell for 600,000 you have to pay tax on in my case half of your earnings as we have 12.5 acres Nice one even though its your primary place of residence Be careful Trev
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Post by chooky on Oct 18, 2011 16:16:01 GMT 8
Trev,
Talk to your accountant. My understanding is that 2.5 hectares of the property is tax free, so not all of it is taxable. Also, I would want a written valuation on the 2.5 hectares around the house as the residence and the balance as the investment property. Hopefully, the residence component is valued at a higher value than the investment land, again reducing the taxable component. BUT have a good chat with your accountant about this.
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Post by mamich on Oct 18, 2011 16:37:47 GMT 8
Yes you are right Trev, only the house and up to 2 hectares of land for domestic use around it are covered by the main residence exemption. But remember the house and land around it is worth more than the extra few acres because of the house and other improvements associated with it. Also you can choose which land is in the 2 hectares and which is not. Costs associated with buying and selling can partly be deducted and any capital improvements on the non exempt portion. So it is less than half and then you get the discount if you have been there more than twelve months. so although it sucks it isn't half the gain that is taxed. Hope this helps message me if you want more info Trev owe you a favour for those beautiful chicks
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Post by chooky on Oct 18, 2011 22:25:39 GMT 8
Trev,
Just a thought. When did you buy this property, before or after 20th September 1985? If it was before, you are not liable for Capital Gains Tax.
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Post by quambie on Oct 19, 2011 9:26:07 GMT 8
Thanks for the info guys amamich have PM you Thanks Trev
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