There isn't anything formal to advise the ATO that it has been your main residence - the way in which you prepare your tax return (ie not including a capital gain on disposal) serves as notice.
As Taxduck indicated, to avoid withholding tax being taken out on sale, you should apply for a clearance certificate. This can be done yourself, for free, as soon as you want, as the certification lasts for 12months. Settlement agents generally charge for doing this, so you can save yourself a little bit by doing it yourself. It's usually quick, but can take up to 28 days, so if you are selling on the next 12 months, might as well cross it off your list now.
One thing to remember going forward is that you will be subject to CGT for part of the time you own property number 2. So to minimise your CGT exposure, I would setup an excel document or some other tracking method now to track all of your holding costs on property 2 - including costs when you live in it, as these can be added to your cost base to determine the partial CGT on the gain when you ultimately sell (but get an accountant to help you with the calculations - just start collating this information and keeping receipts now). These costs include interest, council and water rates, repairs, improvements (track all your renovations well!!), building insurance (not contents) etc... it might be tedious but will save you money long term
the way in which you prepare your tax return (ie not including a capital gain on disposal) serves as notice.
- Assuming selling the main residence is the only CGT event and fully exempted
- Isn't the correct way to show that:
- add the capital gains section (for online)/indicate yes to CGT event (for paper tax return)
- include the exemption
- write 0 for the capital gain?
62 views
4 replies