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Can you help with a capital gains tax question. We are

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Can you help with a capital gains tax question

Accountant's Assistant: The Accountant will know how to help. Please tell me more, so we can help you best.

We are selling 100 acre hobby farm. We are not gst registered and do not make money from it:

Accountant's Assistant: Is there anything else the Accountant should be aware of?

We have been living at this property for 15 years. We are purchasing another block of land and building on it.

Submitted: 1 month ago.Category: Tax
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Answered in 33 minutes by:
1/4/2018
Tax Professional: Barbara, Enrolled Agent replied 1 month ago
Barbara
Barbara, Enrolled Agent
Category: Tax
Satisfied Customers: 4,791
Experience: 20+ years of experience in tax preparation; 30+ years of experience as a real estate/corporate paralegal.
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Welcome to Just Answer. My name is ***** ***** I will be happy to assist you.

Your ‘main residence’ (your home) is generally exempt from capital gains tax (CGT). To get the exemption, the property must have a dwelling on it and you must have lived in it. You're not entitled to the exemption for a vacant block.

Generally, a dwelling is considered to be your main residence if:

  • you and your family live in it
  • your personal belongings are in it
  • it's the address your mail is delivered to
  • it's your address on the electoral roll, and
  • services such as gas and power are connected.

The main residence exemption is not based on one factor alone, and the weight given to each varies depending on individual circumstances. The length of time you stay there and your intention in occupying it may also be relevant.

You're eligible for a full main residence exemption if the dwelling:

  • has been the home of you, your partner and other dependants for the whole period you've owned it
  • has not been used to produce assessable income – that is, you've not run a business from it, rented it out or flipped it, and
  • is on land of two hectares or less.

https://www.ato.gov.au/General/Capital-gains-tax/Your-home-and-other-real-estate/Your-main-residence/

One hectare is equal to 2.47105 acres.

Based on the information you provided, you would not be entitled to the full main residence exemption.

Please let me know if I can assist you further.

Thank you and best regards,

Barb

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