Can the capital gains tax reporting obligations from the sale of the investment property be altered due to financial hardship?
No. This ruling applies for the following period : Year ending 30 June 20XX The scheme commenced on: DD MM YY
On DD MM YY, you purchased the investment property (the property) and had sole ownership interest in the property. You have been with your spouse since MM YY and have been sharing finances since DD MM YY. In YY, the mortgage was re-financed, and your spouse was added to the mortgage over the investment property. On DD MM YY, you and your spouse negotiated a reduced interest rate over a period for your main residence and the property. On DD MM YY, you and your spouse entered a financial hardship arrangement which remedied the interest for a short-term period. Due to financial obligations your spouse returned to full time work. In MM YY, due to financial hardship, the property was sold to reduce the debts over your mortgages on the property and your main residence. The property sale discharged the mortgages in full and the remaining profit was used towards the main residence and credit card debt.
Income Tax Assessment Act 1997 Section 118-130 Income Tax Assessment Act 1997 Section 102-20 Income Tax Assessment Act 1997 Section 104-10 Question Can the capital gains tax obligations on the sale of your investment property be altered due to financial hardship? Summary The Commissioner does not have discretion under the tax law, to alter the reporting obligations on the capital gain or loss from the legal owner of the property, due to financial hardship. Detailed reasoning Section 104-10 (2) of the Income Tax Assessment Act 1997 (ITAA 1997) provides that you dispose of a CGT asset when you either enter into a contract for its disposal, or where no contract exists, when the change of ownership occurs. Section 104-10 (4) of the ITAA 1997 explains when you will make a capital gain or capita