Capital Gains Tax - Selling my house?

Hi, please i need your help with some tax queries.

Im wanting to sell my investment property. Its been an investment for the last 5 odd years but i did live in the property for close to 2 years.

Im wanting to use the profit to clear all my debt & then invest the remaining amount in a term deposit for future use on another property.

However im worried about the tax man taking half of this money off me, is there anyway that i can get around paying capital gains on this or am i doomed to hand it over?

Any help is much appreciated, Thanks

You won't get out of paying tax on a capital gain but you won't be paying half of the profit to the tax office. It will be much less than that if you increase the cost base to reduce the net gain (e.g. purchase price, costs of acquisition and selling, capital works, non capital non deductible costs of ownership etc) and can apply a main residence exemption apportionment and the capital gains 50% discount. You'll only be taxed on whatever the net capital gain is after all that.

Considering how much money could be at stake here, you need to consult with a qualified accountant who is an expert in capital gains tax. I wouldn't recommend that you take this to somewhere like H & R Block. Their consultants do short basic courses; they don't have uni degrees and professional accreditation. You get what you pay for. Spend money to save money. You should know what I mean :)

OK, you (1 person) get 250k$$ of gain tax free if you lived in that house for 2 years of the last 5 (and you don't need to have been in there all the time, just a total of 2). If you've been there "almost 2" then that doesn't cut it. You might want to see if you can hit that number.

You will have to pay capital gains tax regardless of how long you have lived in that house as it is not your principal dwelling. Just how much you pay depends on who does your tax return, get professional advice it doesn't have to be an accountant it can be a tax consultant like H & R Block etc.
http://www.ato.gov.au/individuals/conten...

One important detail missing is - is this your only property?

If so, you may be able to avoid any gains issues by ensuring that the property is nominated as your principal place of residence.

If, however, you own another property then it becomes a little more difficult. You would need to nominate the property being sold as your PPR. This would then shift or delay any capital gains until such time as you sold the unnominated or second property (if in fact you own one - note this does not relate to a property you are occupying as a tenant).

The issues around PPR, and the exemptions are quite complex so my advice would be to seek out a registered tax agent (CPA, Chartered or NIA). They will run through all the different scenarios with you, help to minimise the amount of tax payable (if any is payable) and ensure that the timing of any sale is maximised.

You first have to work out the gain that you have made on the place. This is done by taking the selling price (less any legals and commission to agents that is payable) and subtracting the purchase price (including any legals and stamp duty on purchase).
You can deduct 50% of it as you have held it longer than 12 months. From the remaining you can pro-rate the time you lived in the house against the total time you owned the house (2/7) as this portion is not taxable.
You may be able to access further provisions such as if you were claiming the house as your principal residence when you were not living in it but see an accountant about this. Worst case is you should only pay about 16% of the total gain in tax.