Big factors in the decision to sell the investment property are capital gains tax and the potential of the property. This is something only you can decide.<\/p>\n
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Selling an investment property can have tax implications that are worth considering.<\/span>Credit: <\/span>Simon Letch<\/cite><\/p>\n I agree that it\u2019s good to help the children sooner rather than later, and if getting a part pension is one of your goals, you could make them gifts for a house deposit from the sales proceeds \u2013 after five years, when you are nearing pensionable age, those gifts would cease to exist for Centrelink purposes.<\/p>\n Just be aware that in that time, the Centrelink thresholds could change, and your superannuation could go to a level where you were over the threshold for the assets test.<\/p>\n We lived in our house in Sydney for 10 years and then moved interstate. The house has now been rented for five years. We are planning to move back into the house in the next few weeks, but only for a short period. How long must we live in the house again as our Primary Place of Residence (PPR), before we can rent it out for a second time and not lose the PPR status when the house is sold in the future?<\/strong><\/p>\n There is no specific time. You need to occupy the property to maintain its tax-free status, but you must be able to prove you were living in it as your principal residence. Evidence of this would include being registered on the electoral roll, having the home as your mail address, and if you have children, the fact they are going to local schools. It\u2019s a matter of consultation with your accountant.<\/p>\n You have often written that, to avoid the death tax, it\u2019s good policy to liquidate all your superannuation and deposit it in your bank account before your demise. I have a self-managed super fund with a family company as trustee. How quickly and efficiently can I do that since I have accounts in my super in both accumulation and pension mode? Also, are there any potential complications in transferring the proceeds of the sale (in the company\u2019s name) into my personal bank account?<\/strong><\/p>\n The basic issue here that you need to get the money out of superannuation to avoid the death tax on a benefit left to a non-dependent. It need not necessarily be in cash. You could transfer the shares in specie to your own name as a member benefit, and that would have the same effect as placing the money in the bank.<\/p>\n Seek advice about whether it\u2019s possible for you to move your entire fund to pension mode before you make the transfer. If it\u2019s possible, the earnings of entire fund will be tax-free, and there should be no CGT payable by the fund when the assets are transferred. The ability to do this will depend on whether you have any unused transfer balance cap.<\/p>\n My wife and I are retired \u2013 she receives an income stream from Hesta of $650 a fortnight, a part pension of $564 a fortnight and an annuity income of $500 a month. She has shares worth about $25000 which she has had since 1995 and which have built up because all dividends have been reinvested. Will she have to pay tax on them if she chooses to sell them?<\/strong><\/p>\n In a reinvestment scheme, there is tax to pay on the dividend whenever they are paid, and shares under the scheme are part of the base cost.<\/p>\n I imagine the CGT would be minimal given the size of her portfolio and the type of income she is receiving, but her first job should be to contact the share registry and find out the cost of all the shares. Then she could time the sale and amount of any shares to minimise CGT.<\/p>\n Noel Whittaker is the author of Retirement Made Simple<\/em> and other books on personal finance. Email: noel@noelwhittaker.com.au<\/strong><\/p>\n