Sarah bought an investment property for $600,000 in January 2020 and sold it for $750,000 in March 2024. She incurred $15,000 in selling costs. What is her net capital gain for CGT purposes?
Correct Answer
C) $67,500
Sarah's capital gain is $750,000 - $600,000 - $15,000 = $135,000. Since she held the property for more than 12 months, she qualifies for the 50% CGT discount, reducing her assessable capital gain to $67,500.
Why This Is the Correct Answer
Selling costs form part of the cost base, so the gain is $750,000 − $600,000 − $15,000 = $135,000. Sarah held the property for over four years, so as an individual she applies the 50% discount, leaving a net capital gain of $67,500.
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