Income
7. What is the Main Residence?
Firm / Chambers:
Last updated: 31 Jul 2015
- The 'main residence' is not a defined term in the tax law.
- A number of factors are taken into account to determine whether a dwelling qualifies as a main residence in part or full. The Australian Taxation Office (ATO) in Taxation Determination TD 51 suggests that the relevant factors include:
- the length of time living in the dwelling although there is no minimum time;
- where the taxpayer’s family lives;
- whether personal belongings of the taxpayer have been moved into the dwelling;
- the address to which mail for the taxpayer is delivered;
- the taxpayer’s address on the electoral roll;
- the connection of relevant services such as phone, gas and electricity; and
- the taxpayer’s intention in occupying the dwelling.
- Generally a taxpayer who has lived in a dwelling for more than 12 months should be able to satisfy the criteria unless they have another main residence. If there has been occupancy for less than 12 months there is less certainty about whether the main residence exemption will be available.
- Qualifying for the exemption may not be straightforward. This is particularly the case if the property is used to produce income or if there are periods of absence.
- Properly documenting the timing of use and change of use will be important in establishing the criteria to meet the exemption.
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