selling my residence and use the money to pay off the mortgage on my rental property and use my rental as my primary residence and keep it for 12 month or more, what happens if I sell it then, do I still pay capital gains tax , is this ok or not feasible
Hey @homework,
You've said your selling your main residence to live in your rental property for a period of time then going to sell that as well. First off when you sell your main residence there won't be any CGT implications as this has been your main residence and not used to produce income at any stage.
However, as you will have already sold your main residence when you go to sell the rental property there may be CGT implications as this hasn't always been your main residence. But you may be entitled to a partial exemption.
We do have a CGT property exemption tool available on our website. You can use this to work out what CGT implications you will have at the time you sell the other property.
Hey @homework,
You've said your selling your main residence to live in your rental property for a period of time then going to sell that as well. First off when you sell your main residence there won't be any CGT implications as this has been your main residence and not used to produce income at any stage.
However, as you will have already sold your main residence when you go to sell the rental property there may be CGT implications as this hasn't always been your main residence. But you may be entitled to a partial exemption.
We do have a CGT property exemption tool available on our website. You can use this to work out what CGT implications you will have at the time you sell the other property.
Hi Anita, I tried that exemption tool, is there a number I can ring to ask somebody at the ato , as I have asked an accountant and he wasnt sure and I think he would have to ask the ato, so just wondering if I could, im retiring and need advice. Ive asked my superannuation but they only deal in super Thanks
Hey @homework,
We don't have a specific number for the CGT agents, but I think you would find the Technical assistance team very handy, if you want to reach out to them, they're definitely able to help!
Before you do, lets see if the info I give you helps.
If your rental property was rented from when you first bought it, up until you moved into it, it'll be subject to CGT. After you move into your rental and assuming its not used to produce income anymore, then you can look to see if you're entitled to a partial main residence exemption. If you are then this can apply from the time you moved in.
Your situation will look something like this -
CGT from start to when you moved in.
MRE from when you moved in until you sell. Assuming it was your MR for this period.
You can apply the discount as long as you meet the eligibility criteria.
Your accountant should be able to help you with your calculations.
15 Apr 2026 · 4 min read time
15 Apr 2026 · 8 min read time
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