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Leon, Solicitor
Category: Australia Law
Satisfied Customers: 42348
Experience:  BEc Dip Ed, Dip Law (SAB) MTax (UNSW)
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I would like to sell my unit but am confused about Capital

Customer Question

Hi, I would like to sell my unit but am confused about Capital Gains. I bought the unit around 15 years ago as my first home. I moved away for work and rented my unit out. I has been rented for approx. 6 years.
The unit was bought cheap and is old in Darwin. There was a big price hike in realestate and my little place was worth a lot more then what I paid.
Do I pay capital gains?
If so do I pay on the capital gains on the (not sure on words) the change in worth from when I bought it or the change in worth in the time I rented?
Submitted: 7 months ago.
Category: Australia Law
Expert:  Leon replied 7 months ago.

Good Afternoon

My name is ***** ***** I am a NSW Solicitor. Thank you for your question, and will do my best to assist you with your question. Please understand this is not legal advise Please understand this is not legal advice but a guide to assist you.

There is a rule that allows you to treat is as your principal place of residence even if you rent it out for a period provided you have elected that it is your principal place of residence

The following link from the ATO gives you an explanation with examples.

I am not sure what you have done with your accountant when you decided to rent it and that is important. But if you have elected that it is your principal place of residence, even thought you rented it, you should not be liable for CGT.

If you have to pay CGT there will be an adjustment based on the period you rented and the period you lived in it. '

Your accountant can give you more information on this and also what the tax would be based on your taxable income. CGT is not a fixed amount of tax. It is added to your income and you pay tax as if it were income earned in that year

I hope this makes sense and is of assistance. If there is nothing further

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If I have missed anything, or you have any further questions please let me know

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