Hi All,
Can I ask for your inputs.
If I sell my house (owner occupied) for 400k net, originally bought for 240k, but still owing the bank 300k, what will be the capital gain tax, and how many percent?
Thanks.
Capital Gain Tax Question on Selling House
artxty on 08/11/2018 - 07:42
Comments
CGT is only applicable on investment properties - the profits on your single owner occupied property are not assessed by the tax man
For investment property, debt doesn't come into the equation, except the capitalised interest.
CG = sold price - bought price - capitalised expenses + cumulative building depreciation claimed
If held over 12 months, you will be taxed 50% of CG at your marginal tax rate.
originally bought for 240k, but still owing the bank 300k,
How is this possible if you didn't refinance and redraw from the property? If you did you will need to check tax implications with an accountant because its a lot more complex depending upon what time you refinanced and what you used the money for. CGT is reduced by 50% if holding the property for more than 12 months and does not apply if its you PPR.
Was it your main residence from the time it was bought until the time it was sold? Did you have any other main residences during that time? Do you have a spouse? Has your spouse had any main residences other than this house during the ownership period?
If it was yours (and your spouse if applicable) main residence for the whole ownership period, then capital gains are disregarded.
Nil CGT on principal place of residence
As others said no CGT on principle place of residence.
However, if there was a period of time when the property was rented out, or if a portion of the property was rented out, then you will need to make Capital Gains Tax calculations.
you need to find the right real estate agent.
i was lucky the agent that sold our house i knew for 30+ years.
i told him he could keep the deposit $5K if he could make the capital gains "disappear"
i told him he could keep the deposit $5K if he could make the capital gains "disappear"
easy. sell for under what you paid for it.
the house was inherited and had basically increased in value over 20 years
No, myusername is referring to something far less aboveboard. Don't know why they'd admit to that on a public forum though.
“originally bought for 240k, but still owing the bank 300k“
It seems you will never pay off your house unless you are going to sell it.
I'm under the impression that if you live in house for 12 months plus as primary residence, then move out and rent for up to 6 years elsewhere and lease out your house you can claim exemption.
why don't I trust this ^^^ seems overly complicated and gives me a headache.
No CGT on PPOR. Have you lived in it the entire time you have owned it? If so, no worries. If it has at any time not been your PPOR you may need to make some calculations and pay CGT on the gains made while it was not your PPOR. You'll need to discuss this with your accountant.
Thank you all for your inputs.
We still live in the house for the last 6 yrs, never had it rented out, primary residence. I did a few cash out to pay all my loans & cards that's why it came to 300k owing.That makes it your Principal place of residence = No capital gains tax to pay :)
if it's your principle place of residence then there is no CGT.