I'm looking at the ATO website - Treating former home as main residence - which states:
Your main residence (your home) is generally exempt from CGT.
Usually, a property stops being your main residence when you stop living in it. However, for CGT purposes you can continue treating a property as your main residence:
- for up to 6 years if you used it to produce income, such as rent (sometimes called the '6-year rule')
- indefinitely if you didn't use it to produce income.
During the time that you treat the property as your main residence after you stop living in it:
- It continues to be exempt from CGT (the same as if you were still living in it, even if you start renting it out after you leave).
- You can't treat any other property as your main residence
Assume I bought a house in 2010, lived in it as my main residence for 10 years, then moved out in 2020 to live with my partner. She already has a home, is the sole owner of her residence and has lived there for 20 years. I commenced renting out my home once I moved out in 2020.
I have read that spouses are only entitled to one main residence exemption between them. Is this correct?
If so, does this mean I lose my entitlement to a CGT main residence exemption under the 6 year rule for my former home? (assume she will not want to split her main residence exemption with me)
What if we sign a binding financial agreement that prohibits me from ever having a share of ownership of her property. Does this mean I can still regard my former home as my main residence, and retain an entitlement to a CGT main residence exemption under the 6 year rule?
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