I know there is a lot floating around on the 6 year rule but to me its all very generic. Wondering what peoples opinion on this scenario are.
Bought a house and moved in as PPOR. 6 month later moved out and rented it. haven't bought a new house. renting myself. met someone else who has a PPOR but has since moved out and now rents with me. we will claim my property as PPOR under the six year rule as it has a bigger gain. She had only owned her for about 18 months.
My question is we are looking at buying a house together. Once we do so that will become our PPOR. Hence we stop claiming it on my other property. I haven't been out of my property 6 years yet and we really don't want to sell it.
When we do sell it one day, do we just claim the PPOR all the way up to when we bought our new house together and simply divide by years of ownership in total, apportioning PPOR years and non PPOR years?
Or my preferred option, if legal, is to get my old PPOR, now investment property professionally valued at the same time we buy our new PPOR together, i.e. when the PPOR swaps houses. And this become the new cost base when we sell and we would happily pay the CGT on the gain from that reset value.
My reason for this is I have a fair sizeable gain up to this point and seems crazy to divide that by non PPOR years at this point. I might actually be better sell it now if i can't.
For example. (not real figures)
Bought for $100k 2000
Valued at $500k 2014 new PPOR bought and status lost.
Sell $550k 2017.
If it was just based on divided years $550k - $100K = $450k gain.
divided by years as investment 3 Years $450/17 *3 =$79K CGT.
Or using reset value $550k-$500k = $50K CGT
Can you even divide by years once you go over 6 years or do you then have to pay the gain on the whole time from purchase..
Can you even reset the value?
Thought? any links to precedents that show this. i have researched but finding it hard to find this. Might have to call the ATO.
Bought a house and moved in as PPOR. 6 month later moved out and rented it. haven't bought a new house. renting myself. met someone else who has a PPOR but has since moved out and now rents with me. we will claim my property as PPOR under the six year rule as it has a bigger gain. She had only owned her for about 18 months.
My question is we are looking at buying a house together. Once we do so that will become our PPOR. Hence we stop claiming it on my other property. I haven't been out of my property 6 years yet and we really don't want to sell it.
When we do sell it one day, do we just claim the PPOR all the way up to when we bought our new house together and simply divide by years of ownership in total, apportioning PPOR years and non PPOR years?
Or my preferred option, if legal, is to get my old PPOR, now investment property professionally valued at the same time we buy our new PPOR together, i.e. when the PPOR swaps houses. And this become the new cost base when we sell and we would happily pay the CGT on the gain from that reset value.
My reason for this is I have a fair sizeable gain up to this point and seems crazy to divide that by non PPOR years at this point. I might actually be better sell it now if i can't.
For example. (not real figures)
Bought for $100k 2000
Valued at $500k 2014 new PPOR bought and status lost.
Sell $550k 2017.
If it was just based on divided years $550k - $100K = $450k gain.
divided by years as investment 3 Years $450/17 *3 =$79K CGT.
Or using reset value $550k-$500k = $50K CGT
Can you even divide by years once you go over 6 years or do you then have to pay the gain on the whole time from purchase..
Can you even reset the value?
Thought? any links to precedents that show this. i have researched but finding it hard to find this. Might have to call the ATO.