Capital gains tax regarding.

Who knows anything about Capital Gains Tax in Australia regarding property?

• lived in house for 3 years rented it out for 9 months at a loss moved back in for 4 months till sold do I still have to pay full rate of tax? which is?

• Answer:

  from the time you bought and house and started living in it till day 1 you started renting it out, this period is capital gains free. from the day you moved back in till the day you sell it, this period is also capital gains free. capital gains will only apply during the time the property was rented out. basically the way of working out the capital gains is to first work out how much profit you made on the property, then work out wat percentage the 'renting period' is. for example: if you bought the property for $200,000 and sold it for $300,000, you would have made a profit of $100,000, in a normal case, half of the profit would be the amount liable for capital gains, but in your case, only a percentage of this amount is liable for capital gains. let's just say the period from when you first lived at the property till the day you rented it out is 30% of the whole time you owned it, and the period you had it rented out is 60% and the day you moved back in till you sell it is 10%, therefore 60% of $100,000 = $60,000 then half of this = $30,000, this is the amount liable for capital gains. remember only to 'half' the profit when everything's worked out from the 'whole' of the profit. this $30,000 amount which is liable for capital gains is then added to your other normal income like salary/wage from working, interests etc, then you pay tax like you normally would depending which tax bracket all of these income brings you to.