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1 Are you entitled to the full main residence exemption in section 118-110 of the Income Tax Assessment Act 1997 (ITAA 1997) on the sale of the Property?

No. Question 2 Are you entitled to a partial main residence exemption in section 118-110 of the Income Tax Assessment Act 1997 (ITAA 1997) on the sale of the Property? Answer Yes. This ruling applies for the following periods: XX/XX/20XX to XX/XX/20XX XX/XX/20XX to XX/XX/20XX The scheme commences on: XX XXXX 20XX

In XX/20XX you entered a contract to purchase the Property with settlement occurring in February 20XX. It was your intention to retire at the Property as soon as practicable following the sale of a home you previously owned, which occurred in XX/20XX. In XX/20XX, you were made redundant. Notwithstanding you were XX years of age, this decision was unexpected. In XX/20XX, the World Health Organisation declared Covid-19 a global pandemic. The State you were moving to implemented restrictions requiring all non-essential travellers to isolate in hotel quarantine for 14 days. Given your employment situation and the pandemic restrictions, you decided to lease the Property out for XX months commencing XX/20XX (First Lease). In XX/20XX you purchased a caravan and shortly thereafter, commenced your travels across the Country in your caravan. You decided that you would travel to the State you were moving to via a ferry as this was the most convenient means of transporting your pets and vehicles to the Property. In XX/20XX your tenant cancelled the First Lease, and you offered a new lease to another tenant (Second Lease).

In XX/20XX upon the expiry of the Second Lease, you offered a third lease to the same tenant (Third Lease). In XX/20XX, the State you were moving to allowed all travellers from your previous location to enter the state without the need to quarantine. In XX/20XX the State you were moving to allowed all travellers from the State you were residing in, at that time, to enter the state without the need to quarantine. The ferry service was resumed. In XX/20XX the Third Lease expired, and the Property was vacant. In XX/20XX you submitted two applications to travel to the State you were moving to via the State you were residing in, the latter of which was approved. In XX/20XX you travelled to the State where the Property resided and commenced occupation of the Property. In XX/20XX you entered a contract to sell the Property with settlement occurring in XX/20XX.

Income Tax Assessment Act 1997 section 118-135. Summary It is considered that you did not move into the Property 'by the time it was first practicable for you to move into it' within the meaning of section 118-135 of the ITAA 1997 and the circumstances of temporary delays envisaged by the Explanatory Memorandum to the Tax Law Improvement Bill (No. 1) 1998 (the Explanatory Memorandum). Detailed Reasoning Section 118-135 of the ITAA 1997 provides "If a dwelling becomes your main residence by the time it was first practicable for you to move into it after you acquired your ownership interest in it, the dwelling is treated as your main residence from when you acquired the interest until it actually became your main residence." The Explanatory Memorandum indicates that section 118-135 of the IT