At 30, June 2013, John sold his Melbourne property (property A) worth $800,000 in order to invest two new properties. Property ‘A’ purchase at 1, January 2011, basic cost is $500,000, component are as following:
Purchasing price - $429,530
Legal fee -$4,400
Stamp duty fee -$25,070
Real estate agent fee -$16,000
Renovation fee -$25,000
Total -$500,000
He should declare his $300,000 capital gains at year 2013 caused he acquired $300,000 when he sold his investment property in year 2013. He get 50% of capital gain tax (CGT) relief at 7, May 2012 because holding that property for more than 12 months. At 7, May 2012, market value of the property is $700,000, with 50% of capital gain tax relief, his taxable capital income should be reduce from $200,000 to $100,000. From 8, May 2012, capital gains tax will levied according to normal rules. Therefore, his taxable amount should be $72,000, this means that the tax rate is only 24% when he sold out his Property 'A’.