ATO – What attracts our audit attention
To help you taxpayers get things right, you should consider the behaviours, characteristics and tax issues t
Your ‘main residence’ (your home) is generally exempt from capital gains tax (CGT). To get the exemption, the property must have a dwelling on it and you must have lived in it. You’re not entitled to the exemption for a vacant block.
Generally, a dwelling is considered to be your main residence if:
The main residence exemption is not based on one factor alone, and the weight given to each varies depending on individual circumstances. The length of time you stay there and your intention in occupying it may also be relevant.
You’re eligible for a full main residence exemption if the dwelling:
If the full exemption applies your capital gain or loss is disregarded – you don’t pay tax on any capital gain, but nor can you use any capital loss to reduce your assessable income.
Alternatively, you may be entitled to a partial exemption.