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Discussion in 'Real Estate' started by rajiv, 15th Oct, 2008.

  1. rajiv

    rajiv Member

    16th May, 2008
    Perth, WA
    What is the definition and INTERPRETATION of principal place of residence?
    For example If I rent a house with my family and buy a 2 BR apartment. I "Live" in the apartment (keep it vacant) for 6 months, while continue to rent the other house where my entire family lives, and then convert the apartment into investment property to claim negative gearing. Is this acceptable?
  2. Simon Hampel

    Simon Hampel Co-founder Staff Member

    9th Jun, 2005
    Sydney, Australia
    I suggest you read this page by the ATO: Is the dwelling your main residence?


    The following factors may be relevant in working out whether a dwelling is your main residence:

    • the length of time you live there – there is no minimum time a person has to live in a home before it is considered to be their main residence
    • whether your family lives there
    • whether you have moved your personal belongings into the home
    • the address to which your mail is delivered
    • your address on the electoral roll
    • the connection of services (for example, phone, gas or electricity), and
    • your intention in occupying the dwelling.

    A mere intention to construct or occupy a dwelling as your main residence – without actually doing so – is not sufficient to obtain the exemption.

    ... in other words, I think the ATO may well have an issue with what you are suggesting.