Main Residence First, Rental Property Second
If your home was your main residence first and later becomes a rental, you’re treated as having “acquired it”
at the time you first rented it out. When you sell, the capital gain is based on the market value at the date it
first became income-producing. If you sell it within 12 months of renting it out, you can’t apply the 50% CGT discount.
Rental Property First, Main Residence Second
If the property was a rental first and later becomes your main residence, the capital gain is worked out based on
the time it was used for each purpose. When you sell, the gain is pro-rated based on the number of days it was rented
vs the number of days it was your main home. If you’ve owned the property for more than 12 months, the 50% CGT discount
can still apply.
