Q.My husband owns a small block of units and I own a house. Both are rental properties and were bought pre-1985. From a reading of the current CGT rules issued by the ATO, it is unclear to us whether we are exempt from CGT, if we sell them, or not.
A. A capital gain is the increase in the value of an asset realized when you sell it. If you own the asset in your own name or in partnership and have owned the asset for more than 1 year, 50% of the gain forms part of your assessable income. The 50% discount does not apply for non-residents or companies.
If you make a capital loss, you cannot claim it against income but you can use it to reduce a capital gain in the same or future income tax year.
All assets acquired prior to 20 September 1985 are exempt from CGT. Based on the information you have provided, the only reason I could see you incurring a liability for CGT would be if you have changed the ownership of the assets since 1985.