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McCloudy33(Initiate)Initiate
24 July 2021

I purchased my property in 2007

This was my primary residence until 2010

My property has since been rented out, while I have been renting elsewhere (in Australia and in the UK for a time)

There seems to be some suggestion that the '6 year rule' can be reset, so I'm trying to gauge the truth in this!

My question is: is there any benefit to making the property my PPOR again now (in terms of CGT) if I was to sell in the future? Ie. Will it reset the 6 years?

There is obviously some small benefit as I won't pay CGT on the days I'm living there, but after 11 years of being rented this seems like it would be negligable?

I'm not even sure I will sell but wanted to know if it was worth the hassle of moving back in to reduce CGT in the future if I did sell.

Thanks for the help!

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1,537 views
3 replies

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Most helpful replyATO Certified Response

BlakeATO(Community Support)Community Support
ATO Certified Response26 July 2021

Hi @McCloudy33

Yes, the six year absence rule can be reset! This means that if you move into the property as your main residence again, the main residence rule and the six year rule start over.

In your example this means that your property would be exempt from capital gains for 2007 - 2010, and if you move back in, say for one year, 2021-2022, and then the six years after, 2022-2028.

Remember that generally only Australian residents for tax purposes at the time of sale can use the main residence exemption (including the six year absence rule).

You can read about treating a dwelling as your main residence after you move out on our website.

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Most helpful replyATO Certified Response

BlakeATO(Community Support)Community Support
ATO Certified Response26 July 2021

Hi @McCloudy33

Yes, the six year absence rule can be reset! This means that if you move into the property as your main residence again, the main residence rule and the six year rule start over.

In your example this means that your property would be exempt from capital gains for 2007 - 2010, and if you move back in, say for one year, 2021-2022, and then the six years after, 2022-2028.

Remember that generally only Australian residents for tax purposes at the time of sale can use the main residence exemption (including the six year absence rule).

You can read about treating a dwelling as your main residence after you move out on our website.

McCloudy33(Initiate)Initiate
28 July 2021

Thanks!

Following up then, what kind of time frame is considered long enough to be acceptable as main residence status before renting again?

I also thought the initial exeption would be 2007 to 2013 because of the initial 6 year rule?

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