Accounting and Financial Services
Capital Gains Tax Valuations
At WBP Group, our team of property professionals is dedicated to providing accurate and reliable property valuations for a variety of taxation purposes. With guidance from the Australian Taxation Office, accounts and financial planners we ensure that our valuations adhere to the latest regulations and standards.
One taxation purpose is Capital Gains Tax (CGT), this being a tax levied on the profit generated from the sale of an asset. In the context of real estate, while most personal homes are exempt (principal place of residence) this tax may apply to the sale of investment properties, vacant land, business premises and holiday homes.
Any gains from above-mentioned property types are to be reported in your income tax return. To calculate the taxable capital gain or loss, a capital gains tax property valuation report is essential. This report helps determine the increase or decrease in property value between the purchase and the sale and calculate the taxable capital gain or capital loss.
If you have transitioned your home from a primary residence to an investment property, or vice versa, the team at WBP Group can undertake both current and retrospective valuations. Retrospective valuations enable us to determine the property’s value when it was acquired or converted into an investment property, while a current valuation provides insights into the property’s value in today’s market.
A Capital Gains Tax Valuation, serves as a reliable method for determining the fair market value of a property asset, safeguarding individuals and entities from being unfairly taxed at a higher tax rate than for what they are liable. Accountants recommend their clients have a sworn valuation by a Certified Practising Valuer to ensure they have complied with all regulatory requirements.
Please call 1300 302 581 and we’ll be happy to arrange a current or retrospective valuation to meet your requirements.
Frequently Asked Questions:
Renting out your former home as an investment property triggers CGT. For example, if your home becomes an investment property, you should engage a property valuer as soon as it goes onto the rental market. An internal inspection of the property, at the current date, will provide the valuer with the most comprehensive information to provide an accurate report. However, it is common to provide a retrospective valuation when required, particularly when access to the property is no longer available.
Additionally, gifting a property can trigger the need to pay CGT, based on the property’s market value at the time of the gift.
Our reports can be submitted to the Australian Tax Office or provided directly to your accountant to assist in the calculation of capital gains tax. We also work alongside accountants, financial advisors and other allied professionals to provide an accurate report, in a timely manner with impressive customer service.
At the outset, it is important to identify the date at which the valuation is required. Is the valuation required at the current date, or a ‘retrospective’ valuation as at a previous date? Normally, a retrospective valuation is required, when the family home (principal place of residence) becomes an investment property and is thus income producing. This should be confirmed with your accountant to ensure the correct date of valuation, prior to any work being commenced.
It is best practice that a full inspection of the property be carried out wherever possible. However, if the property has since been sold and access is not available, a kerbside valuation can be conducted. In this case, please provide as much information as possible regarding the internal features of the property and changes made to the property. The valuer will conduct an external inspection from the street and will rely on online resources where possible for additional information.
