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Sanjesh1(Initiate)Initiate
15 Mar 2024

Property was purchased on 07/04/1983. Mum and dad owned 50/50 joint tenant.

Mum passes away 31/12/1991. Mums 50% gets transferred to Dad 30/04/1992.(post CGT)

Dad now owns 50% of his pre CGT and 50% of post CGT. Dad passed away on 01/11/2006.

Up until this date property is principal place of residence. From 2008 up until 2024 property is rented.

2 brothers inherits the property and plan to sell.

I know the cost base is the market value of the asset on the day deceased died.

Question

Does mums date of death on 31/12/1991 has any bearing on the cost base? Should it be ignored and cost base becomes market value of dads date of death?

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280 views
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Most helpful reply

Taxduck(Taxicorn)Taxicorn
15 Mar 2024

CGT can often be a very complex part of tax law, and this is no exception. This link explains the cost base of inherited assets.. https://www.ato.gov.au/individuals-and-families/investments-and-assets/capital-gains-tax/inherited-assets-and-capital-gains-tax/cost-base-of-inherited-assets

As 50% of the asset was owned by your dad pre 20th September 1985 and the other 50% owned from 30/04/1992 then it appears as if there are 2 separate cost bases. One is market value as at 01/11/2006 and the other is market value as at 30/04/1992. Someone else may have a different opinion, but that's how I see it.

I would suggest you seek professional tax advice.

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Most helpful reply

Taxduck(Taxicorn)Taxicorn
15 Mar 2024

CGT can often be a very complex part of tax law, and this is no exception. This link explains the cost base of inherited assets.. https://www.ato.gov.au/individuals-and-families/investments-and-assets/capital-gains-tax/inherited-assets-and-capital-gains-tax/cost-base-of-inherited-assets

As 50% of the asset was owned by your dad pre 20th September 1985 and the other 50% owned from 30/04/1992 then it appears as if there are 2 separate cost bases. One is market value as at 01/11/2006 and the other is market value as at 30/04/1992. Someone else may have a different opinion, but that's how I see it.

I would suggest you seek professional tax advice.

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