Hi there,
I'm acting as an executor of an estate, where the main residence property is over 2 hectares. The land was bought in 1979 by joint tenants, and they built a large shed in 1980 and the main house in 1983. There have been no significant improvements on the property since then. The husband died in 2015, and the wife, who then automatically inherited his half of the property, died in 2022. A beneficiary has been living in the house while the estate has been in process. The house is about to be sold as part of settling the estate, and the estate will pay any CGT owing.
I have the following questions:
(a) was there was a CGT event in 2015 when the husband passed away?
(b) is this current proposed sale a CGT event?
(c) if this sale is a CGT event, to what percentage is it liable?
My understanding is that because both the land and significant improvements are pre-1985, the 2015 event should be fully exempt. However, I'm less sure as to whether this current sale is fully exempt, or whether the wife's inheritance of 50% of the property in 2015, means the estate is now liable for CGT on 50% of the portion of property excluding the 2 hectares covering the main residence.
Can anyone confirm or correct my assumptions? Would greatly appreciate the help. Thanks.
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