Capital gains tax CGT
The basic algorithm of capital gains tax when Australian real estate is sold
(The following calculation method is just the basic principle, and does not calculate the tax impact of other activities. Taxpayers should consult their own accountants for tax filing)
Total income from house sale-house purchase cost-maintenance cost = capital appreciation (taxable income)
Total income from the sale of the house: generally the sale price of the house
House purchase cost: including the price when the house was purchased, immediate expenditure items such as stamp duty and immediate maintenance, etc. There are different calculation methods for several real-time expenditures
Maintenance costs: generally include interest, property fees, municipal fees, land tax and management costs, etc. This needs to be calculated in detail according to your lease or living situation (if used for self-occupation)
The capital appreciation (taxable income) calculated from this also has several algorithms for different situations:
1. CGT 50% Discount 50% discount: If the seller holds assets for more than 12 months, this clause will take effect.
2. Changes to the 50% discount for overseas people: As of May 8, 2012, the 50% discount is still valid for overseas people. If the property is acquired before, the 50% discount can be applied to the previous value-added, and the subsequent value-added cannot be applied.
3,6-year-rule Six-year rule: If this property is used as the seller’s owner-occupied house and used for lease after the seller moves out, it will be sold within six years without paying capital gains tax.
