How will the new capital gains tax on property affect YOU?

From 1st October 2015 if you buy and sell a property within a two year period you will be taxed on the capital gain.

Exemptions are:
1) The main home
2) Business premises
3) Farm land as long as it is an economic unit, which may mean lifstyle blocks may be caught.
4) Inherited property
5) Property acquired by way of a matrimonial property settlement

Expenses will be allowed against the capital gain, including realestate fees and improvement costs. After allowing for deductions, any remaining gain will be taxed at the owner's marginal rate of tax as ordinary income.  Losses will be ring-fenced and only able to be offset against taxable gains from land sales.  

It's important to remember the old rules still apply if a property was bought and sold outside of the two year period, but was purchased with the intention of resale, then any capital gain is still taxed.

For more information contact Better Business Accountants