Income tax: capital gains: is land under a unit of accommodation subject to the main residence exemption under Subdivision 118-B in Part 3-1 of the Income Tax Assessment Act 1997 if the taxpayer sells the unit of accommodation separately from the land?

No. The land does not qualify for the main residence exemption.

Paragraph (c) of the definition of 'dwelling' in subsection 118-115(1) brings within the definition 'any land immediately under the unit of accommodation'. It only does so, however, while the land remains immediately under the unit of accommodation.

If a unit of accommodation is removed from land and the land is then sold, the land does not come within paragraph (c) of the definition of 'dwelling' in subsection 118-115(1). This applies to land under all types of units of accommodation.

Land under a unit of accommodation qualifies for the main residence exemption only if the land and the unit of accommodation are sold together as a dwelling.