What is the main residence exemption for Capital Gains Tax?
Correct Answer
A) A full CGT exemption on selling a dwelling that was your main residence throughout.
The main residence exemption provides complete exemption from Capital Gains Tax when selling your principal place of residence, provided certain conditions are met including that it was your main residence throughout the ownership period.
Why This Is the Correct Answer
Division 118 of the Income Tax Assessment Act 1997 disregards the whole capital gain on a dwelling (and up to two hectares of land) that was the owner's main residence for the entire ownership period and was not used to produce income.
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